Annual Report - Mandarin Oriental Hotel Group

Mandarin Oriental Hotel Group is an international hotel investment
and management group with deluxe and first class hotels and resorts in sought-after
destinations around the world. The Group now operates, or has under development,
over 10,000 rooms in 23 countries with 16 hotels in Asia, 14 in The Americas and nine
in Europe and North Africa. The Group has equity interests in many of its properties
and net assets of approximately US$2.3 billion as at 31st December 2007.
Mandarin Oriental’s aim is to be recognized widely as the best global luxury hotel
group, providing 21st century luxury with oriental charm in each of its hotels. This
will be achieved by investing in the Group’s exceptional facilities and its people, while
maximizing profitability and long-term shareholder value. The Group regularly receives
recognition and awards for outstanding service and quality management. The strategy
of the Group is to open the hotels currently under development, while continuing to
seek further selective opportunities for expansion around the world.
The parent company, Mandarin Oriental International Limited, is incorporated in
Bermuda and has its primary listing in London, and further listings in Bermuda and
Singapore. Mandarin Oriental Hotel Group International Limited, which operates
from Hong Kong, manages the activities of the Group’s hotels. Mandarin Oriental is
a member of the Jardine Matheson Group.

Contents
01 Corporate Overview
03 Corporate Information
04 Highlights
06 Chairman’s Statement
08 Group Chief Executive’s Review
14 Operating Summary
16 Development Portfolio
18 International Recognition
0 Financial Review
6 Directors’ Profiles
8 Financial Statements
74 Principal Subsidiaries, Associates, Joint Ventures and Managed Hotels
76 Independent Auditor’s Report
77 Five Year Summary
78 Corporate Governance
83 Shareholder Information
84 Mandarin Oriental Hotel Group Contact Addresses
86 Sales and Reservations Offices
Mandarin Oriental International Limited

Corporate Information
Directors
Simon Keswick Chairman
A J L Nightingale Managing Director
Edouard Ettedgui Group Chief Executive
Jonathan Gould
Mark Greenberg
Julian Hui
Henry Keswick
R C Kwok
Lord Leach of Fairford
Dr Richard Lee
Robert Léon
Sydney S W Leong
Lord Powell of Bayswater KCMG
James Watkins
Percy Weatherall
John R Witt
Company Secretary and
Registered Office
C H Wilken
Jardine House
33–35 Reid Street
Hamilton, Bermuda
Mandarin Oriental Hotel Group
International Limited
Directors
A J L Nightingale Chairman
Edouard Ettedgui Group Chief Executive
Jonathan Gould
Mark Greenberg
A R R Hirst
M H Hobson
W Hültner
L R Lambert
James Riley
T L Stinson
John R Witt Chief Financial Officer
Corporate Secretary
N M McNamara
Annual Report 2007 3

Highlights
Mandarin Oriental International Limited
u Strong contribution from Hong Kong hotels
u Eight new hotel projects announced, including Beijing and Paris
u Full-year dividend per share increased by 100% to US¢6.00
Results
2007 2006 Change
US$m US$m %
Combined total revenue of hotels under management 1 1,007.7 850.3 19
Earnings before interest, tax, depreciation and amortization 2 190.2 116.4 63
Profit attributable to shareholders 108.2 80.0 35
Profit attributable to shareholders – excluding gains on disposal
and writeback of impairment of an associate 87.1 45.0 94
US¢ US¢ %
Earnings per share 11.16 8.28 35
Earnings per share – excluding gains on disposal and writeback
of impairment of an associate 8.98 4.66 93
Dividends per share 6.00 3.00 100
US$ US$ %
Net asset value per share 1.18 1.03 15
Net asset value per share with leasehold properties at valuation 3 2.34 1.78 31
1 Combined revenue includes turnover of the Group’s subsidiary hotels in addition to 100% of revenue from associate, joint venture and
managed hotels.
2 EBITDA does not include gains on disposal and writeback of impairment of an associate.
3 The net asset value per share with leasehold properties at valuation has been presented after adjusting for the market value of the Group’s
leasehold interests. International Financial Reporting Standards (‘IFRS’) do not permit leasehold interests of owner-occupied land to be
carried at valuation. The Group considers that the IFRS treatment does not reflect the economic substance of its underlying property
investments. Therefore, the Group has presented the net asset value per share taking into account the fair market value of leasehold
interests as supplementary financial information in addition to the net asset value per share in accordance with IFRS.
4 Mandarin Oriental International Limited

Combined total revenue
by geographical area
US$m
541.2
126.0
114.3
214.7
86.2
667.3
173.5
815.4
204.5
850.3
172.6
1,007.7
267.9
03 04 05 06 07
Hong Kong & Macau
Other Asia
The Americas
Europe
124.5
259.2
110.1
157.0
330.6
123.3
261.1
291.5
125.1
302.3
278.7
1 8.8
EBITDA and net interest expense
US$m
68.8
03
27.7
99.0
04
34.9
124.0
05
31.2
Earnings before interest, tax, depreciation
and amortization (EBITDA)
Net interest expense
116.4
06
26.0
190.2
07
24.9
Combined total revenue
by type of business
US$m
541.2
273.2
195.4
72.6 68.6 79.0 83.4
102.4
03 04 05 06 07
Rooms
Food & beverage
Others
Net debt / adjusted equity
US$m
975.3
03
53.9%
526.1
667.3
356.7
242.0
1,171.4
04
Adjusted equity
Net debt
44.1%
517.1
815.4
449.2
287.2
1,445.4
05
21.5%
310.8
850.3
462.7
1,725.7
304.2
06
18.2%
313.8
1,007.7
.4
2,279.3
349.9
07
8.1%
184.9
Annual Report 2007

Chairman’s Statement
Overview
Favourable conditions in most markets and a limited new supply of hotel rooms in key city centre locations
enabled Mandarin Oriental to achieve higher average rates and record earnings in 2007. In particular, the
Group’s two wholly-owned Hong Kong hotels performed well, including its original flagship, Mandarin
Oriental, Hong Kong, which was reopened in late September 2006 after completion of a major renovation
programme.
The Group’s development programme continued apace in 2007 and, with a record number of new hotel
projects announced, Mandarin Oriental now has 10,000 rooms in operation or under development.
Performance
Earnings before interest, tax, depreciation and amortization for 2007 were US$190 million compared with
US$116 million in 2006 when Mandarin Oriental, Hong Kong was closed for nine months.
Profit attributable to shareholders in 2007 was US$108 million, which includes a US$16 million gain arising
from the sale of half the Group’s 50% equity interest in Mandarin Oriental, New York and a US$5 million
investment writeback in respect of the value of the Group’s 25% interest in its Kuala Lumpur hotel. This
compares with US$80 million in the previous year, which included a post-tax gain of US$35 million arising
from the sale of The Mark hotel in New York. Excluding the non-trading items, profit attributable to
shareholders was US$87 million in 2007 compared with US$45 million in 2006.
Earnings per share for the year were US¢11.16 compared with US¢8.28 in 2006. Excluding non-trading items,
earnings per share in 2007 were US¢8.98 compared with US¢4.66 per share in 2006.
The Directors recommend a final dividend of US¢5.00 per share. This, together with the interim dividend of
US¢1.00 per share, will make a total annual dividend of US¢6.00, an increase of 100% compared with the
US¢3.00 paid in respect of 2006.
The Group remains in a strong financial position. The net asset value per share with leasehold properties
adjusted for fair market value was US$2.34 at 31st December 2007, an increase of 31% compared with
US$1.78 at the end of 2006.
Mandarin Oriental International Limited

Developments
The Group announced eight new projects in 2007, comprising hotels in Beijing, Guangzhou, Taipei, Milan
and Paris and three in resort destinations. All of the 18 hotels the Group now has under development will be
managed on behalf of third-party owners, with the exception of Paris which is a long-term lease. Ten of the
projects incorporate a Residences at Mandarin Oriental component, in addition to the residences being built
next to the Group’s existing hotel in London.
Mandarin Oriental Riviera Maya, Mexico opened in February 2008, bringing the total number of the Group’s
operating hotels to 21. The opportunity for future growth is significant as the Group is now well-recognized as
a pre-eminent international luxury brand, with a reputation for exceptional service.
People
The provision of service at the level we demand in our hotels, combined with meeting the challenges of growth,
depends on the initiative, dedication and hard work of each of the 10,000 people that work throughout our
Group. On behalf of the Board, I would like to express my appreciation to all of them.
Outlook
While demand was stable in the first two months of the year, economic conditions in 2008 may become more
difficult in some of the Group’s markets. The outlook for Mandarin Oriental, however, remains encouraging
due to both the strength of the brand and the limited new supply of luxury hotels. This is particularly true in
Asia and Europe where the Group has significant hotel ownership interests.
Simon Keswick
Chairman
6th March 2008
Annual Report 2007

Group Chief Executive’s Review
Business strategy
Mandarin Oriental aims to be widely recognized as the best international luxury hotel group offering
21st century luxury with oriental charm in sought-after destinations around the world. An award-winning owner
and operator of some of the world’s most prestigious hotels and resorts, our Group will continue to grow
profitably its global presence. Mandarin Oriental now operates 21 hotels with a further 18 under development,
bringing the total number of rooms to 10,000 in 23 countries, reflecting the increasing strength of the brand.
Progress achieved
A number of significant accomplishments resulted in 2007 being another milestone year for Mandarin Oriental.
Firstly, the Group achieved its highest ever financial performance. This resulted from the enhanced
contributions of our growing and diversified global portfolio which benefited from strong market conditions
in our key locations. The increasing demand for luxury travel experiences, the continued limited new supply
in our sector and the impact of the global growth of the Group is clearly demonstrated by comparing our
performance over the past four years, since the end of the Asian downturn in 2003:
2004 2005 2006 2007 07 vs. 04
US$m US$m US$m US$m %
Combined total revenue of hotels under
management 667 815 850 1,008 51
EBITDA
Profit attributable to shareholders excluding
99 124 116 190 92
non-trading items 19 41 45 87 358
Secondly, Mandarin Oriental’s international expansion continued to accelerate. In 2007, the Group ended the
year with a record of eight new management contracts announced, including luxury hotels in the strategically
important cities of Beijing and Paris. Further progress has been made in the development of Mandarin Oriental’s
hideaway concepts, with the recent opening of Mandarin Oriental Riviera Maya, Mexico. During the year,
the Group also announced a further three Residences at Mandarin Oriental that will accompany hotel projects,
bringing the total number of branded Residences to 12. The Group continues to review additional opportunities
for luxurious urban hotels, resorts, hideaways and residences in important locations around the world.
8 Mandarin Oriental International Limited

Finally Mandarin Oriental increased its global recognition. The Group and its hotels were highly successful in
achieving significant awards from respected travel associations and publications, with more Mandarin Oriental
hotels featured than ever before. Highlights include the 2007 Condé Nast Traveler US ‘Readers Choice Awards’
which featured ten Mandarin Oriental hotels and ‘The World’s Best’ from Travel & Leisure, with nine hotels
appearing. Mandarin Oriental, New York remains one of only a few hotels to achieve both the prestigious
‘Mobil Five Star’ and the American Automobile Association’s ‘Five Diamond Lodgings Award’. The Group’s
expertise in holistic spa operations was also recognized with Mandarin Oriental achieving more spa awards than
in any other year, including ‘Best Wellness and Spa Company’ by Spa Asia and the most ‘Outstanding Brand’ in
Spa Finders 2007 Readers Choice Awards, with six individual hotel spas winning in a variety of categories. Finally
Mandarin Oriental Hotel Group was voted Best Overseas Hotel Group by readers of The Observer and The
Guardian newspapers in the UK in October 2007.
Performance in 2007
Set out below is a review of the Group’s performance in 2007, with reference to the following strategic
objectives:
◆ Being recognized as the world’s best luxury hotel group
◆ Strengthening our competitive position
◆ Increasing the number of rooms under operation to 10,000
◆ Achieving a strong financial performance
1) Being recognized as the world’s best luxury hotel group
Mandarin Oriental is enjoying increasing recognition for creating many of the world’s most desirable luxury
hotels. From our roots in the heart of Asia, where most of our original properties remain market leaders having
benefited from renovations in recent years, Mandarin Oriental has expanded into the global arena, with
award-winning properties in many of the world’s leading destinations. The visibility of our brand will increase
further as the number of hotels we operate around the world continues to grow.
The Group remains focused, as always, on delivering the brand attributes which define our own style of luxury.
This includes creative hotel design and architecture, innovative dining experiences, expertise in holistic spa
operations, guest-orientated technology and, of course, the legendary service which remains the foundation of
everything we do. The investment behind our brand and our people over the past few years has led to the Group
becoming well respected as a management company amongst the owners and developers of luxury hotels around
the world.
Such strong brand recognition allows our properties to achieve premium rates and compete effectively.
Annual Report 2007

Group Chief Executive’s Review Continued
2) Strengthening our competitive position
To be the market leader within their local environment is a key goal for each of our hotels, and we continued
to improve our competitive positioning in 2007. Demand for luxury travel grew, as did our ability to increase
average rates. This led to higher Revenue Per Available Room (RevPAR) across all regions, with Asia up 12%,
Europe up 26% and The Americas up 14% over 2006. Consequently, operating profits at most of the individual
hotels have shown significant improvement over the previous year.
The highlights of each region are as follows:
Asia
The Group’s results benefited from the full contribution of Mandarin Oriental, Hong Kong which reopened
as one of the world’s legendary hotels in late September 2006 following a nine-month closure and a
US$150 million renovation. In its first full year of operation since the renovation, the hotel achieved an
occupancy of 74% and an average rate of US$399, 50% above the rate in 2005. While the hotel’s occupancy was
affected by the tail end of the renovation work in the earlier part of the year, occupancy was 84% in the fourth
quarter. The re-designed hotel has been acclaimed locally and internationally and is quickly re-establishing its
top position in readership surveys of prestigious publications around the world. It was voted ‘Best Renovated
Hotel’ in Business Traveller UK’s annual readership survey in 2007.
The Excelsior, Hong Kong, the Group’s second wholly-owned property in the city with 885 rooms, also had
an excellent year, achieving an 8% increase in RevPAR over 2006 results, with the average rate up to US$179
from US$163.
In Macau, Mandarin Oriental maintained its competitive position despite a significant increase in the city’s
hotel supply which led to a RevPAR decrease of 5% year-on-year.
As a result of further improvements in the local economies, RevPAR increased by 22% in Manila and 17%
in Kuala Lumpur. In September 2007, the Group’s 50% owned hotel in Singapore was re-named Mandarin
Oriental, Singapore to align the property better with the Group’s brand, following the successful renovation
in 2005. The hotel capitalized on strong market conditions throughout the year, achieving a 28% increase in
RevPAR with the average rate up to US$209 from US$163 in 2006. In December 2007, Mandarin Oriental,
Jakarta closed its doors for two years to embark on a far-reaching, US$50 million renovation programme
designed to re-position the property as one of the city’s most luxurious and contemporary hotels.
10 Mandarin Oriental International Limited

Despite the political uncertainties in Thailand, The Oriental, Bangkok maintained its strong competitive
position and once again appeared at the top of the most important world-wide travel awards.
Mandarin Oriental, Tokyo performed well in its second full year of operation, achieving a 19% increase in
RevPAR over 2006 with an average rate of US$475. The hotel continues to enhance its reputation as one of the
top luxury hotels in the city. Recently, it was voted the top-rated hotel in Japan in Zagat’s 2007–2008 World’s
Top Hotels, Resorts & Spas Survey, and its fine-dining restaurant Signature was awarded a Michelin Star.
Europe
In Europe, strong demand for luxury accommodation, particularly from the leisure market, and a limited new
supply of hotel rooms, drove increases in room rates in all of our hotels. In particular, Mandarin Oriental Hyde
Park, London had an excellent year, increasing its average rate from US$731 in 2006 to US$886 in 2007, a 12%
increase in local currency terms. Occupancy also increased from 85% to 88%. Following the completion of a
full scale rooms renovation programme in the first half of the year, Mandarin Oriental, Munich maintained its
position as the undisputed market leader in the city, and increased its average rate to US$585 from US$503 in
2006, a 7% increase in local currency terms. In Geneva, Mandarin Oriental improved both its occupancy and
average room rate, resulting in a 23% increase in RevPAR in local currency terms, despite having commenced a
renovation to the public areas of the hotel in October 2007. The work will be completed in June 2008 and will
include new restaurants and bars as well as seven additional roof-top suites which will be particularly appealing
to the leisure traveller.
The Americas
All of the Group’s hotels in The Americas benefited from strong demand and limited new supply, resulting in
rate increases in each location. Mandarin Oriental, Washington D.C. did well to increase its contribution to the
Group’s results, with a 14% increase in RevPAR mainly due to higher average rates. The hotel has established
itself as one of the city’s most luxurious properties, and over the longer term, there is potential for further
achievement as the local neighbourhood develops along the Potomac River.
Once again, the Group’s flagship New York property received many accolades from its guests and the world’s
media. Mandarin Oriental, New York achieved an average rate of US$937 with an occupancy of 76%,
resulting in a 15% increase in RevPAR over the previous year. Our Miami property also increased its RevPAR
performance by 14% over the previous year.
Annual Report 2007 11

Group Chief Executive’s Review Continued
3) Increasing the number of rooms under operation to 10,000
With the record number of new projects announced in 2007, Mandarin Oriental will successfully achieve its
mid-term goal of operating 10,000 rooms in key global locations within the next few years. During the year, we
announced eight new Mandarin Oriental hotels, resorts or hideaways in Beijing, Guangzhou, Taipei, Marbella,
Milan, Paris, Costa Rica and St Kitts. Mandarin Oriental Riviera Maya, Mexico is the Group’s most recent hotel
to open in February 2008, while Mandarin Oriental, Sanya, a resort destination on China’s Hainan Island,
should open by the mid-year. Both hotels had been planned to open in 2007, but were affected by construction
delays. Beijing and Boston should also open later this year. Going forward, the timing of new hotel openings will
be subject to change as developers find it more difficult to access new financing.
The number of hotels operated by the Group will increase from 21 currently to 39 in the coming years. Critical
mass and strong geographic diversification will then have been achieved with 16 properties in Asia, 14 in The
Americas and nine in Europe and North Africa.
The brand has been enhanced further by the increasing number of Residences at Mandarin Oriental which are
generally integrated with the new hotel developments. The Group receives one-off branding fees from these
residential projects, as well as ongoing revenues resulting from the use of hotel facilities by the owners of the
villas or apartments.
The potential for future growth remains significant. The Group constantly reviews opportunities for additional
luxury properties, each of which must meet exacting criteria aimed at providing exceptional experiences to
Mandarin Oriental guests. Most new opportunities are in the form of management contracts which require
limited capital from the Group but generate significant branding and management fees. With the exception
of Paris which is a long-term lease, all 18 current projects under development are management contracts,
highlighting the strength of the brand. At the same time, the Group will remain a significant owner of hotel
properties, particularly in major cities, and we are well positioned to take advantage of future investment
opportunities that may arise in strategic locations. Ownership provides potential long-term capital appreciation,
ensures the continuing control of our brand heritage and gives us increased credibility with third-party hotel
owners and developers. Our hotel investments can also provide the Group with significant profits and cash flow
as it benefits fully from favourable market conditions, as demonstrated by our portfolio in 2007. Overall,
the intent of operating both owned and managed hotels remains fundamental to the strategy
of the Group.
12 Mandarin Oriental International Limited

4) Achieving a strong financial performance
Mandarin Oriental achieved a record performance in 2007, with improved results from the Group’s growing
international portfolio as well as the return of the contribution from the fully renovated, 100%-owned
Mandarin Oriental, Hong Kong. Excluding gains from disposals and other non-trading items, profit attributable
to shareholders in 2007 was US$87 million compared to US$45 million in 2006.
The completed sale of half of its 50% interest in Mandarin Oriental, New York in March 2007, resulted in a
post-tax gain of US$16 million. The Group continues to own 25% of this strategically important property with
improved terms for our long-term management contract.
In 2007, the Group carried out a full review of its hotel investments by independent, third-party valuers. This
has been reflected in the adjusted net asset value per share which was US$2.34 at 31st December 2007, an
increase of 31% from 2006 as the Group continued to benefit from capital appreciation on its hotel investments.
Reflecting the Group’s growth in earnings and strong financial position, Mandarin Oriental has recommended
a 100% increase in the full year dividend to US¢6.00.
The future
Mandarin Oriental is well positioned to benefit from its global portfolio, as new hotels come on stream in
the coming few years and the Group doubles in size. The demand for luxury travel and the limited new supply
in most of the destinations in which we operate should also provide support, notwithstanding possible future
uncertainties.
As we open new and exciting projects in the world’s most sought-after destinations, the recognition of Mandarin
Oriental as a global luxury brand grows stronger. The Group is therefore in an excellent position to deliver our
long-term vision of being widely recognized as the best luxury hotel group in the world.
Edouard Ettedgui
Group Chief Executive
6th March 2008
Annual Report 2007 13

Operating Summary
There are 21 hotels in operation, but the operating summary includes only hotels in which the Group has a significant
equity interest.
A S I A
Mandarin Oriental, Hong Kong 100% ownership (closed
from 28th December 2005 to 27th September 2006 for renovation)
14 Mandarin Oriental International Limited
%
2007 2005 † Change
Available rooms 487 524 (7 )
Average occupancy (%) 74 81 (9 )
Average room rate (US$) 399 266 50
RevPAR (US$) 294 215 37
† 2005 numbers have been provided for comparison purposes, as on
re-opening in late September 2006, only a limited number of rooms
were available.
The Excelsior, Hong Kong 100% ownership
%
2007 2006 * Change
Available rooms 885 884 0
Average occupancy (%) 88 89 (1 )
Average room rate (US$) 179 163 10
RevPAR (US$) 157 145 8
Mandarin Oriental, Tokyo 100% leasehold
%
2007 2006 * Change
Available rooms 179 179 0
Average occupancy (%) 77 66 17
Average room rate (US$) 475 471 1
RevPAR (US$) 367 309 19
Mandarin Oriental, Manila 96.2% ownership
%
2007 2006 * Change
Available rooms 443 443 0
Average occupancy (%) 80 81 (1 )
Average room rate (US$) 97 79 23
RevPAR (US$) 78 64 22
Mandarin Oriental, Jakarta 88.3% ownership
(closed from 23rd December 2007 for renovation)
%
2007 2006 * Change
Available rooms 404 404 0
Average occupancy (%) 37 49 (24 )
Average room rate (US$) 68 65 5
RevPAR (US$) 25 32 (22 )
Mandarin Oriental, Macau 50% ownership
%
2007 2006 * Change
Available rooms 416 416 0
Average occupancy (%) 66 68 (3 )
Average room rate (US$) 168 173 (3 )
RevPAR (US$) 111 117 (5 )
Mandarin Oriental, Singapore 50% ownership
%
2007 2006 * Change
Available rooms 527 527 0
Average occupancy (%) 75 75 0
Average room rate (US$) 209 163 28
RevPAR (US$) 157 123 28
The Oriental, Bangkok 44.9% ownership
%
2007 2006 * Change
Available rooms 393 393 0
Average occupancy (%) 66 70 (6 )
Average room rate (US$) 269 240 12
RevPAR (US$) 178 168 6
Mandarin Oriental, Kuala Lumpur 25% ownership
%
2007 2006 * Change
Available rooms 632 632 0
Average occupancy (%) 77 79 (3 )
Average room rate (US$) 168 139 21
RevPAR (US$) 129 110 17

E U R O P E
Mandarin Oriental Hyde Park, London 100% ownership
%
2007 2006 * Change
Available rooms 198 198 0
Average occupancy (%) 88 85 4
Average room rate (US$) 886 731 21
RevPAR (US$) 776 620 25
Mandarin Oriental, Munich 100% ownership
(impacted by 3-month room renovation in 2007)
%
2007 2006 * Change
Available rooms 73 73 0
Average occupancy (%) 72 83 (13 )
Average room rate (US$) 585 503 16
RevPAR (US$) 420 416 1
Mandarin Oriental Hotel du Rhône, Geneva
92.6% ownership
%
2007 2006 * Change
Available rooms 190 190 0
Average occupancy (%) 72 65 11
Average room rate (US$) 550 480 15
RevPAR (US$) 398 310 28
T H E A M E R I C A S
Mandarin Oriental, Washington D.C.
80% ownership
%
2007 2006 * Change
Available rooms 400 400 0
Average occupancy (%) 61 58 5
Average room rate (US$) 331 304 9
RevPAR (US$) 201 177 14
Mandarin Oriental, New York 25% ownership
(2006: 50%; 2007: half of 50% ownership sold on 1st March 2007)
%
2007 2006 * Change
Available rooms 248 248 0
Average occupancy (%) 76 75 1
Average room rate (US$) 937 832 13
RevPAR (US$) 715 624 15
Mandarin Oriental, Miami 25% ownership
%
2007 2006 * Change
Available rooms 326 327 0
Average occupancy (%) 72 70 3
Average room rate (US$) 399 359 11
RevPAR (US$) 288 252 14
* Comparative average room rates for prior years have been restated to include other minor rooms revenue to conform to the current year’s presentation
and industry practice.
Annual Report 2007 15

Development Portfolio
Mandarin Oriental Hotel Group currently has 18 hotels and 11 Residences at Mandarin Oriental under development.
Opening dates are planned as follows:
2008
Mandarin Oriental, Beijing
A 241-room hotel in the central business district of Beijing, which will be a key component of the landmark headquarters of the China
Central Television (CCTV) project.
Mandarin Oriental, Sanya
An exclusive 296-room luxury resort on Hainan Island in the South China Sea.
Mandarin Oriental, Boston
A 148-room hotel which will be housed within a mixed-use complex in the heart of the city including 50 Residences at
Mandarin Oriental.
2009
Mandarin Oriental Lago Nam Van, Macau
A second property in Macau which will be part of a prestigious mixed-use complex on the waterfront, featuring 216 rooms.
Mandarin Oriental, Barcelona
A 97-room hotel, housed in the re-development of an elegant mid-20th century building, located on the prestigious Paseo de Gracia.
Mandarin Oriental Jnan Rahma, Marrakech
A 161-room intimate hideaway in the exclusive Palmeraie region with 44 Residences at Mandarin Oriental.
Mandarin Oriental, Las Vegas
A 392-room hotel in the urban development ‘Project CityCenter’, including 227 Residences at Mandarin Oriental.
2010 and beyond
Mandarin Oriental, Guangzhou
A 401-room hotel will be part of the prestigious TaiKoo Hui mixed-use complex, currently under construction in the Tianhe central
business district.
Mandarin Oriental, Taipei
A 300-room hotel which will be a key component of a mixed-use luxury lifestyle and entertainment complex in the heart of the central
business district.
The Residences at Mandarin Oriental, London
An iconic development adjacent to the Group’s London hotel, comprising 80 luxurious Residences at Mandarin Oriental.
Mandarin Oriental, Marbella
A 114-room hotel and 94 Residences at Mandarin Oriental located on a unique mountain top site in Southern Spain, with spectacular
views overlooking the Mediterranean Sea.
16 Mandarin Oriental International Limited

2010 and beyond continued
Mandarin Oriental, Milan
A 104-room hotel housed in the re-development of three elegant 19th century buildings, ideally located on Via Monte di Pietà, one of
Milan’s most prestigious addresses.
Mandarin Oriental, Paris
A 142-room luxurious palace hotel planned to open on rue Saint Honoré.
Mandarin Oriental, Chicago
A 252-room hotel which will be part of an exclusive mixed-use development in Chicago’s growing Millennium Park neighbourhood,
including 103 Residences at Mandarin Oriental.
Mandarin Oriental, Costa Rica
A 130-room beach resort and 92 Residences at Mandarin Oriental located at Playa Manzanillo, in Guanacaste province on Costa Rica’s
northern Pacific coast.
Mandarin Oriental, Dallas
A 139-room hotel in the city’s dynamic new mixed-use Victory Park development with 91 Residences at Mandarin Oriental.
Mandarin Oriental, Grand Cayman
An intimate 114-room hideaway, set on an unspoiled 10-acre beachfront site including 32 Residences at Mandarin Oriental.
Mandarin Oriental, St. Kitts
A 125-room resort and 20 Residences at Mandarin Oriental located on a pristine 50-acre site at Majors Bay, a private cove on
the island’s secluded southeast peninsula.
Mandarin Oriental Dellis Cay, Turks & Caicos
A secluded 197-room hideaway featuring a variety of Residences at Mandarin Oriental housed in 18 stand-alone villas and
79 multi-roomed apartments, all located on an unspoiled 35-acre beachfront site.
Opening dates are subject to change as determined by each project’s owner/developer.
Annual Report 2007 17

International Recognition
Mandarin Oriental Hotel Group is consistently featured by influential global publications as an outstanding hotel
company. Below are quotes from a selection of these publications that highlight individual properties and the Group.
Mandarin Oriental Hotel Group
A “truly top-of-the-line” collection of “fashionable, upscale hotels”, the five U.S. outposts of this Asia-based chain combine “amazing
locations, gorgeous rooms”, “outstanding service catering to your every whim”, world-class, cutting-edge spas and some of the
best dining in their respective cities; “exceptional attention to detail” includes high-tech electronics, “swanky” bath amenities and
plush terry robes…Zagat, US, 2007
The Oriental, Bangkok
One of Asia’s grande dame hotels, this 131-year-old favorite along the river is known for its impeccable service and connections to literary
greats. National Geographic Traveller, 2007
Mandarin Oriental Dhara Dhevi, Chiang Mai
It was heavenly, dreamy,…a glorious full blown fantasy. The Independent Traveller, UK, 2007
Mandarin Oriental, Hong Kong
The revamp of the Mandarin left it looking similar but beautifully spruced-up, a huge relief for its regulars. Tatler, UK, 2007
A triumphant return for one of the most famous hotels in the world. It has been brought into the 21st century without losing its very
distinctive character. Business Traveller, UK, 2007
The Landmark Mandarin Oriental, Hong Kong
The Landmark Mandarin Oriental, Hong Kong is modern and classic, and it’s worth checking in just for the OTT bathrooms. Amber
restaurant is top-notch, as are drinks at the sexy MO bar downstairs. High life, UK, 2007
Mandarin Oriental, Kuala Lumpur
Every amenity for business travelers, plus a prime location in the Kuala Lumpur city centre. Travel+Leisure, US, 2007
Mandarin Oriental, Singapore
Every room of this tower in a very peaceful, and yet central, Marina Bay location, has floor-to-ceiling windows that overlook the harbour or
city. Staff are genuinely warm and seem proud to be here. Condé Nast Traveler, US, 2007
Mandarin Oriental, Tokyo
This is Tokyo Central…A hotel plugged into the 21st century. Tatler Travel Guide, UK, 2007
One of the most lavishly appointed spaces in the city, it has the best views. FT: Weekend, UK, 2007
18 Mandarin Oriental International Limited

Mandarin Oriental Hyde Park, London
A prime location and the city’s most innovative hotel spa. Don’t miss the tai chi classes in Hyde Park. Travel+Leisure, US, 2007
Mandarin Oriental, Munich
Mandarin Oriental is the cream of the five-star crop, with superb city and Alpine views from the rooftop terrace and pool. This haven of
calm in the centre, just behind Hofbrauhaus, packs in 73 luxurious rooms and suites. Business life, UK, 2007
Mandarin Oriental, Prague
The opulent Mandarin Oriental Prague, located in a 14th century monastery in Mala Strana, the city’s Left Bank, is leading the pack
among luxury hotels in the Czech capital. Gourmet, US, 2007
Mandarin Oriental, Miami
Mandarin Oriental is an oasis of Asian calm and order. Invoking the attention to detail for which the Mandarin Oriental brand is renowned,
service is at a level of precision rarely found in more laissez-faire Miami. forbestraveler.com, US, 2007
Mandarin Oriental, New York
State-of-the-art facilities, including an exceptional spa and a pool with Hudson River views. Travel+Leisure, US, 2007
The “gorgeous” rooms offer the “best technology and home entertainment”, “exceptional amenities” and “panoramic” vistas, the service
is “incomparable” and the “top-notch spa and fitness facilities.” Zagat, US, 2007
Mandarin Oriental, San Francisco
Top-of-the-line rooms with stunning views…The glass walled halls on floors 40-48 have head-spinning vistas. Travel+Leisure, US, 2007
Mandarin Oriental, Washington D.C.
If you want to be in the heart of the most powerful place in the world, look no further than Mandarin Oriental, Washington D.C.
forbestraveler.com, US, 2007
Annual Report 2007 19

Financial Review
Accounting policies
The Directors continue to review the appropriateness
of the accounting policies adopted by the Group having
regard to developments in International Financial
Reporting Standards (‘IFRS’). The accounting policies
adopted are consistent with those of the previous year,
except that the Group has adopted new standards,
amendments and interpretation to IFRS effective on
1st January 2007, as more fully detailed in the ‘basis
of preparation’ note in the financial statements.
Results
Overall
The Group uses earnings before interest, tax,
depreciation and amortization (‘EBITDA’) to analyse
operating performance. Total EBITDA including the
Group’s share of EBITDA from associates and joint
ventures is shown below:
2007 2006
US$m US$m
Subsidiaries 146.2 73.8
Associates and joint ventures 44.0 42.6
Total EBITDA 190.2 116.4
Subsidiaries
2007 2006
US$m US$m
EBITDA
Less depreciation and
146.2 73.8
amortization expenses (38.5 ) (28.7 )
Gain on disposal of The Mark – 76.8
Operating profit 107.7 121.9
20 Mandarin Oriental International Limited
EBITDA from subsidiaries in 2007 benefited
significantly from the performance at Mandarin
Oriental, Hong Kong which had EBITDA
of US$40.3 million in 2007 compared to a negative
contribution of US$10.9 million in 2006 when the
hotel was closed for nine months of the year. The
Excelsior, Hong Kong had another strong year
improving its EBITDA by 9%. Elsewhere in Asia,
Tokyo continued to make a positive contribution in
its second full year of operation. Manila increased its
EBITDA by over 50% due to improving local market
conditions. Jakarta, which closed at the end of
December for a two-year renovation, made a negative
contribution to the Group’s results including
US$3.1 million of costs incurred in anticipation of the
closure. The hotel will embark on a full scale renovation
costing approximately US$50 million and designed to
reposition the hotel as one of the leading luxury hotels
in the city.
In Europe, the London hotel’s results benefited from
strong market conditions together with the continuing
strengthening of Sterling against the US dollar
leading to a 34% increase in EBITDA. In 2007,
the contribution from Europe also benefited from a
US$8.3 million exchange gain on repatriation of capital
from the London hotel following a refinancing exercise
in July which increased external debt at the property.
The contribution from Munich was down 28% year
on year due to the fact that the hotel underwent a
significant renovation in the year which impacted
occupancy levels. Geneva had an EBITDA increase
of 33% as a result of higher room revenue.

In The Americas, the Washington D.C. hotel doubled
its EBITDA contribution from the previous year.
However, this was offset by lower mezzanine interest
income in 2007 following repayment of mezzanine
loans previously provided to the New York hotel and
the Boston hotel project and higher US corporate costs.
In addition, 2006 also included EBITDA from The
Mark hotel which was sold in February 2006.
In 2007, the contribution from management activities
before depreciation was US$16.2 million compared to
US$14.2 million in 2006. The contribution in 2006
has been restated to reflect the reallocation of Group
management costs related to hotel ownership and
the corporate function from hotel management
activities where they were previously reported. While
management fees increased, these were offset by higher
corporate costs as specialists, particularly in technical
services and human resources, were selectively added
to meet the needs of the Group’s hotels under
development.
Depreciation and amortization expenses were
US$38.5 million for 2007 up from US$28.7 million in
2006, primarily as a result of a full year’s depreciation
charge for the Mandarin Oriental, Hong Kong and
increased depreciation at the Munich hotel, following
renovations.
The pre-tax gain on disposal for 2006 of
US$76.8 million relates to the Group’s sale of its
100% interest in The Mark hotel which was completed
on 16th February 2006 for a gross consideration of
US$150 million. The hotel was originally acquired
in 2000 as part of the US$142.5 million acquisition
of The Rafael Group. The post-tax gain on the disposal
was US$35 million.
Associates and Joint Ventures
The Group’s share of results from associates and joint
ventures was as follows:
2007 2006
US$m US$m
EBITDA
Writeback of an impairment in
44.0 42.6
respect of Kuala Lumpur 5.1 –
Less depreciation and
amortization expenses (11.9 ) (13.1 )
Operating profit 37.2 29.5
Less net financing charges (8.5 ) (10.8 )
Less tax (5.8 ) (5.7 )
Share of results of associates
and joint ventures 22.9 13.0
The Group’s share of EBITDA from associates and joint
ventures increased slightly year on year, notwithstanding
the disposal of half of the Group’s 50% interest in
Mandarin Oriental, New York on 1st March 2007.
While the Macau hotel marginally improved its
EBITDA with higher rental income offsetting a
reduction in room revenue, elsewhere in Asia, Singapore
and Kuala Lumpur increased their EBITDA by 33%
and 27% respectively due to strong market conditions.
The Bangkok hotel also did well in a challenging
environment, increasing its EBITDA contribution
by 15% as a result of the stronger Thai Baht.
The share of results of associates and joint ventures
also benefited in 2007 from a US$5.1 million writeback
of the remaining balance on the US$16.9 million
impairment provision made against the value of the
Group’s interest in the Kuala Lumpur hotel in 1998.
Depreciation and amortization expenses from associates
and joint ventures were US$11.9 million for 2007,
down from US$13.1 million in 2006, primarily as a
result of the partial disposal of Mandarin Oriental,
New York.
Annual Report 2007 21

Financial Review Continued
The Group’s share of net financing charges from
associates and joint ventures was US$8.5 million in
2007, a decrease from US$10.8 million in 2006 again
primarily due to the partial disposal of Mandarin
Oriental, New York.
Gain on partial disposal related to an associate
The sale of half of the Group’s 50% investment in
Mandarin Oriental, New York was completed on
1st March 2007, reducing the Group’s interest to 25%.
The hotel was valued at US$340 million for the purpose
of the sale. On disposal of the 25% interest, the Group
recorded a pre-tax gain of US$25 million, with a
post-tax gain of US$16 million after a tax charge of
US$9 million arising on the disposal. The Group
continues to manage the hotel under a long-term
agreement.
Net financing charges
Net financing charges for the Group and its
subsidiaries increased to US$16.4 million in 2007
from US$15.2 million in 2006. Although interest rates
on Group borrowings generally increased, the Group
benefited from interest income on higher cash balances
arising from recent disposals. In addition, the Group
continued to benefit from its hedging arrangements in
respect of interest rates.
Interest cover in 2007, which is calculated as operating
profit (excluding gains on disposals and the write back
of impairment) before interest and tax (including the
Group’s share of operating profit from associates and
joint ventures) over net financing charges (including the
Group’s share of net financing charges from associates
and joint ventures), was 5.6 times compared with
2.9 times in 2006. EBITDA is also used as an indicator
of the Group’s ability to service debt and finance its
future capital expenditure. Interest cover on this
basis (including the Group’s share of EBITDA from
associates and joint ventures) was 7.7 times in 2007,
up from 4.5 times in 2006.
22 Mandarin Oriental International Limited
Tax
The tax charge for 2007 was US$22.8 million compared
to US$39.5 million in 2006 which included tax charges
arising on the sale of The Mark. The underlying
effective tax rate for the year was 25% largely unchanged
from 2006.
Cash flow
The Group’s consolidated cash flows are summarized as
follows:
2007 2006
US$m US$m
Operating activities
Investing activities:
• Capital expenditure on existing
130 62
properties
• Capital expenditure on
(29 ) (14 )
Mandarin Oriental, Hong Kong (21 ) (112 )
• Investment in Tokyo – (10 )
• Net proceeds on disposals
• Capital distribution from
71 98
associates
• Hotel mezzanine funding –
14 1
net repayment 9 –
• Other
Financing activities:
(5 ) (1 )
• Issue of shares 3 2
• Drawdown of borrowings 536 114
• Repayment of borrowings (464 ) (9 )
• Dividend paid (39 ) (14 )
• Other
Net increase in cash and
– 1
cash equivalents
Cash and cash equivalents
205 118
at 1st January
Cash and cash equivalents
287 169
at 31st December 492 287
The cash flows from operating activities increased
significantly due to the full year contribution from
Mandarin Oriental, Hong Kong as well as the general
improvement in performance at the Group’s subsidiary
hotels.

Capital expenditure on existing properties totalled
US$29 million, compared with US$14 million in 2006.
The increase was partly due to a US$10 million
renovation programme at the Munich property.
Of the total US$150 million renovation cost for
Mandarin Oriental, Hong Kong, US$119 million was
spent in 2006 and before, with US$21 million being
spent in 2007. The remaining US$10 million will be
paid in 2008.
On 1st March 2007, the Group completed the sale of
half of its 50% investment in Mandarin Oriental, New
York receiving gross proceeds of US$39 million. At the
same time the Group received repayment of its
mezzanine loan including accrued interest, amounting
to US$41 million, to give total proceeds of
US$80 million. After transaction expenses and tax
charges arising on the disposal, net proceeds were
US$71 million with a post tax gain of US$16 million.
Included in the 2007 capital distribution from associates
is a US$13 million distribution from Mandarin
Oriental, New York arising from a refinancing of the
property following the restructuring of the ownership.
On 16th February 2006, the Group completed the sale
of its 100% leasehold interest in The Mark hotel for a
gross consideration of US$150 million. After transaction
expenses and tax charges arising on the disposal, net
proceeds were US$98 million with a post-tax gain of
US$35 million.
In 2007, the Group received repayment of its
US$12 million mezzanine loan from the owners of
the Boston hotel and made additional mezzanine
loans totaling US$3 million to other owners of Group
managed hotels for a net repayment of US$9 million.
Dividends
The Board is recommending a final dividend of
US¢5.00 per share for a full year dividend of US¢6.00
per share (2006: US¢3.00 per share). No scrip
alternative is being offered in respect of the dividend.
Property valuation
In accordance with the Group’s accounting policy
whereby independent valuations of the Group’s hotel
property interests are carried out at intervals not
exceeding three years, valuations were carried out at
31st December 2007 by independent, professionally
qualified appraisers on an open market basis.
The revaluation of the Group’s assets has given rise to
a revaluation surplus of US$44 million (net of deferred
tax) which has been credited to the Group’s property
revaluation reserves.
In addition, the Group’s leasehold land has been
revalued upwards by US$402 million, with the increase
primarily attributable to the Group’s two long
leaseholds in Hong Kong. This US$402 million uplift,
however, is not recognized in the financial statements as,
under IFRS, interests in land held under long-term
leases must be stated at cost and amortized over the
period of the lease.
Annual Report 2007 23

Financial Review Continued
Treasury activities
The Group manages its exposure to financial risk using
a variety of techniques and instruments. The main
objective is to manage exchange and interest rate risks
and to provide a degree of certainty in respect of costs.
The Group has fixed or capped interest rates on 49%
of its gross borrowings.
In respect of specific hotel financing, borrowings
are normally taken in the local currency to hedge
partially the investment and the projected income.
At 31st December 2007, the Group’s net assets were
denominated in the following currencies:
24 Mandarin Oriental International Limited
Adjusted
Net assets net assets*
US$m % US$m %
Hong Kong Dollar 86 7 1,125 49
United States Dollar 537 47 537 24
United Kingdom Sterling 195 17 195 8
Thai Baht 86 7 86 4
Euro 70 6 70 3
Swiss Franc 67 6 67 3
Others 111 10 199 9
1,152 100 2,279 100
* see supplementary information section on page 25
Investment of the Group’s cash resources, which totalled
US$492 million at 31st December 2007, is managed
so as to minimize risk while seeking to enhance yield.
The treasury function is not permitted to undertake
speculative transactions unrelated to underlying
financial exposures.
The Group, excluding associates and joint ventures,
had committed borrowing facilities totaling
US$848 million, of which US$677 million was drawn
at 31st December 2007. The principal amounts are due
for repayment as follows:
Facilities Facilities
committed drawn
US$m US$m
Within one year 13 13
Between one and two years 12 7
Between two and three years 116 116
Between three and four years 40 3
Between four and five years 3 3
Beyond five years 664 535
848 677
At 31st December 2007, the Group had US$171 million
of committed, undrawn facilities in addition to its cash
balances of US$492 million. The average tenor of the
Group’s borrowings was 5.9 years (2006: 3.4 years),
following the successful completion of refinancing
initiatives amounting to approximately US$650 million,
principally in relation to the Group’s wholly owned
hotels in Hong Kong, London and Geneva. No major
refinancing is required in the next two years.

Supplementary information
Valuation of hotel properties held on leasehold
The Group’s policy is to revalue all hotel properties
regularly as it considers these properties to be long-term
investments. Prior to 2003, all property investments,
whether freehold or leasehold, were revalued and carried
at fair market value. However, IFRS no longer permits
the carrying of leasehold owner-occupied land at fair
market valuation. The Group considers that the IFRS
treatment does not reflect the economic substance
of the underlying investments, particularly the Group’s
999 year leases in respect of Mandarin Oriental,
Hong Kong and The Excelsior.
In its financial statements, the Group has presented
leasehold land payments at cost less accumulated
amortization over the period of the lease, which is the
recommended IFRS treatment. However, as there is a
significant difference between the fair market value of
the Group’s two Hong Kong properties and their value
as presented in the financial statements, the Group has
also presented supplementary financial information
which takes into account the fair market value of all its
leasehold interests.
The two key measurements affected by the recognition
of the fair market value of these leasehold interests are
net asset value per share and gearing. The necessary
adjustment to shareholders’ funds/net assets is set
out below:
2007 2006
Per share Per share
US$m US$ US$m US$
Shareholders’ funds/
net assets
Add revaluation
surplus relating
1,152 1.18 1,001 1.03
to leasehold land
Adjusted shareholders’
1,127 1.16 725 0.75
funds/net assets 2,279 2.34 1,726 1.78
Net debt of US$185 million at 31st December 2007
was 8% of adjusted shareholders’ funds, compared with
net debt of US$314 million at 31st December 2006
which was 18% of adjusted shareholders’ funds. On an
IFRS basis, gearing was 16 % at 31st December 2007
(2006: 31%).
John R Witt
Chief Financial Officer
6th March 2008
Annual Report 2007 25

Directors’ Profiles
Simon Keswick Chairman
Mr Simon Keswick joined the Board and became
Chairman in 1986. He joined the Jardine Matheson
group in 1962 and is also chairman of Dairy Farm,
Hongkong Land, and a director of Jardine Lloyd
Thompson, Jardine Matheson and Jardine Strategic.
A J L Nightingale* Managing Director
Mr Nightingale joined the Board and was appointed
as Managing Director in 2006. He has served in a
number of executive positions since joining the Jardine
Matheson group in 1969. He is chairman of Jardine
Cycle & Carriage, Jardine Matheson Limited, Jardine
Motors Group and Jardine Pacific; and a commissioner
of Astra. He is also managing director of Dairy Farm,
Hongkong Land, Jardine Matheson and Jardine
Strategic. Mr Nightingale is chairman of the Business
Facilitation Advisory Committee established by the
Financial Secretary in Hong Kong, a council member
of the Hong Kong Trade Development Council, a Hong
Kong representative to the APEC Business Advisory
Council and a member of the Greater Pearl River Delta
Business Council.
Edouard Ettedgui* Group Chief Executive
Mr Ettedgui joined the Board in 1998 and is managing
director of Mandarin Oriental Hotel Group
International. He was formerly group finance director
of Dairy Farm, prior to which he was business
development director of British American Tobacco.
He has extensive international experience in both
financial and general management.
John R Witt* Chief Financial Officer
Mr Witt was appointed as Chief Financial Officer in
2000, having first joined the Group in 1998. He is a
Chartered Accountant and has an MBA from INSEAD.
He has extensive international experience in financial
planning, treasury control and business development in
a variety of consumer industries.
26 Mandarin Oriental International Limited
Jonathan Gould
Mr Gould joined the Board in 2004. He is the Jardine
Matheson group general counsel. Having qualified as an
English solicitor in 1976 and as a Hong Kong solicitor
in 1988, he was previously a senior corporate partner
of Allen & Overy based in Hong Kong and London.
Mr Gould is also a director of Jardine Matheson Limited
and Dairy Farm.
Mark Greenberg
Mr Greenberg joined the Board in 2006. He is group
strategy director of Jardine Matheson. He had
previously spent 16 years in investment banking with
Dresdner Kleinwort Wasserstein in London. He is also
a director of Jardine Matheson Limited, Dairy Farm,
Hongkong Land and Jardine Cycle & Carriage; and a
commissioner of Astra and Bank Permata.
Julian Hui
Mr Hui joined the Board in 1994. He is an executive
director of Owens Company and a director of Central
Development.
Henry Keswick
Mr Henry Keswick joined the Board in 1988. He is
chairman of Jardine Matheson, having first joined the
group in 1961, and is also chairman of Jardine Strategic.
He is a director of Dairy Farm, Hongkong Land and
Rothschilds Continuation Holdings. He is also vice
chairman of the Hong Kong Association.
R C Kwok
Mr Kwok is a Chartered Accountant and joined the
Board in 1987. He joined the Jardine Matheson group
in 1964 and is a director of Jardine Matheson Limited,
Dairy Farm, Hongkong Land, Jardine Matheson and
Jardine Strategic.
* Executive Director

Lord Leach of Fairford
Lord Leach joined the Board in 1987. He is deputy
chairman of Jardine Lloyd Thompson, and a director
of Dairy Farm, Hongkong Land, Jardine Matheson,
Jardine Strategic and Rothschilds Continuation
Holdings. He joined the Jardine Matheson group in
1983 after a career in banking and merchant banking.
Dr Richard Lee
Dr Lee joined the Board in 1987. Dr Lee’s principal
business interests are in the manufacturing of textiles
and apparel in Southeast Asia, and he is chairman of
TAL Apparel. He is also a director of Jardine Matheson
and Hongkong Land.
Robert Léon
Mr Léon joined the Board in 1994. He is a manager of
Qualis and a director of Anzon Energy, Anzon Australia
and Magna Holdings International.
Sydney S W Leong
Mr Leong, a Solicitor of both the Supreme Courts of
Hong Kong and England and Wales, joined the Board
in 1989. He is chairman and a director of a number
of companies, including chairman of Henry G Leong
Estates.
Lord Powell of Bayswater KCMG
Lord Powell joined the Board in 1992. He was
previously Private Secretary and adviser on foreign
affairs and defence to British Prime Ministers, Baroness
Thatcher and Rt Hon John Major. He is a director of
Caterpillar, LVMH Moët Hennessy Louis Vuitton,
Matheson & Co, Safinvest, Textron Corporation,
Schindler Holdings, Northern Trust Global Services,
Yell Group and Magna Holdings. He was formerly
president of the China-Britain Business Council and
chairman of the Singapore-British Business Council.
James Watkins
Mr Watkins joined the Board in 1997. He was a
director and group general counsel of Jardine Matheson
from 1997 to 2003. Mr Watkins qualified as a solicitor
in 1969 and was formerly a partner of the English law
firm, Linklaters. He is also a director of Advanced
Semiconductor Manufacturing Corporation, Global
Sources, Asia Satellite Telecommunications Holdings,
Jardine Cycle & Carriage and MCL Land.
Percy Weatherall
Mr Weatherall joined the Board in 2000 and was
Managing Director from 2000 to 2006. He held a
number of senior positions since first joining the Jardine
Matheson group in 1976 until his retirement from
executive office in 2006. He is also a director of Dairy
Farm, Hongkong Land, Jardine Matheson and Jardine
Strategic.
Annual Report 2007 27

Consolidated Profit and Loss Account
for the year ended 31st December 2007
28 Mandarin Oriental International Limited
2007 2006
Note US$m US$m
Revenue 1 529.5 404.6
Cost of sales (318.8 ) (267.2 )
Gross profit 210.7 137.4
Selling & distribution costs (32.6 ) (27.7 )
Administration expenses (70.4 ) (64.6 )
Gain on disposal of The Mark 5 – 76.8
Operating profit 2 107.7 121.9
Interest income 18.9 11.0
Financing charges (35.3 ) (26.2 )
Net financing charges 3 (16.4 ) (15.2 )
Share of results of associates and joint ventures excluding
writeback of impairment of an associate 17.8 13.0
Writeback of impairment of an associate 4 5.1 –
Share of results of associates and joint ventures 4 22.9 13.0
Gain on disposal related to an associate 6 16.0 –
Profit before tax 130.2 119.7
Tax 7 (22.8 ) (39.5 )
Profit for the year 107.4 80.2
Attributable to:
Shareholders of the Company 108.2 80.0
Minority interests (0.8 ) 0.2
Earnings per share 8
107.4 80.2
US¢ US¢
– basic 11.16 8.28
– diluted 10.96 8.17

Consolidated Balance Sheet
as at 31st December 2007
Net assets
2007 2006
Note US$m US$m
Intangible assets 9 216.2 216.0
Tangible assets 10 995.0 882.5
Associates and joint ventures 11 204.6 190.0
Other investments 10.3 6.4
Loan receivables 12 3.4 12.0
Pension assets 13 34.0 27.1
Deferred tax assets 14 27.5 27.4
Other non-current assets 28 0.2 2.9
Non-current assets 1,491.2 1,364.3
Stocks 4.7 4.3
Debtors and prepayments 15 69.3 65.7
Current tax assets 3.4 –
Cash at bank 27f 492.4 286.7
569.8 356.7
Non-current asset classified as held for sale 24 – 53.9
Current assets 569.8 410.6
Creditors and accruals 16 (105.5 ) (91.0 )
Current borrowings 17 (13.4 ) (25.4 )
Current tax liabilities (7.2 ) (4.4 )
Current liabilities (126.1 ) (120.8 )
Net current assets 443.7 289.8
Long-term borrowings 17 (663.9 ) (575.1 )
Deferred tax liabilities 14 (107.7 ) (72.9 )
Pension liabilities 13 (0.1 ) (1.5 )
Other non-current liabilities 28 (2.9 ) (0.2 )
Total equity
1,160.3 1,004.4
Share capital 20 48.7 48.4
Share premium 21 163.5 160.3
Revenue and other reserves 23 940.1 792.0
Shareholders’ funds 1,152.3 1,000.7
Minority interests 25 8.0 3.7
Approved by the Board of Directors
A J L Nightingale
Edouard Ettedgui
Directors
6th March 2008
1,160.3 1,004.4
Annual Report 2007 29

Consolidated Statement of Recognized Income
and Expense
for the year ended 31st December 2007
30 Mandarin Oriental International Limited
2007 2006
US$m US$m
Surplus on revaluation of properties 78.4 74.1
Actuarial gains on defined benefit pension plans 7.6 5.6
Net exchange translation differences 38.3 45.1
Gain on other investments 0.1 –
Loss on cash flow hedges (5.5 ) (2.9 )
Tax on items taken directly to equity (29.6 ) (25.3 )
Net income recognized directly in equity 89.3 96.6
Transfer to profit and loss on realization of exchange reserves (8.3 ) –
Profit for the year 107.4 80.2
Total recognized income and expense for the year 188.4 176.8
Attributable to:
Shareholders of the Company 184.1 176.8
Minority interests 4.3 –
188.4 176.8

Consolidated Cash Flow Statement
for the year ended 31st December 2007
Operating activities
2007 2006
Note US$m US$m
Operating profit 107.7 121.9
Depreciation 10 37.6 28.4
Amortization of intangible assets 9 0.9 0.3
Non-cash items 27a (3.9 ) (74.7 )
Movements in working capital 27b 5.3 (1.4 )
Interest received 18.5 10.5
Interest and other financing charges paid (34.9 ) (26.5 )
Tax paid (14.0 ) (8.2 )
117.2 50.3
Dividends and interest from associates and joint ventures 12.3 12.1
Cash flows from operating activities 129.5 62.4
Investing activities
Purchase of tangible assets (50.1 ) (135.5 )
Purchase of intangible assets (1.6 ) (0.8 )
Investments in and loans to associates and joint ventures – (0.2 )
Advance of mezzanine loans (3.4 ) –
Repayment of mezzanine loan 12.0 –
Increase in other investments (3.6 ) (1.2 )
Proceeds on disposal of The Mark 27c – 98.5
Proceeds on disposal related to an associate 27d 70.7 –
Capital distribution from associates 27e 14.4 1.2
Cash flows from investing activities 38.4 (38.0 )
Financing activities
Issue of shares 3.5 1.6
Drawdown of borrowings 535.9 113.6
Repayment of borrowings (464.4 ) (8.9 )
Dividends paid by the Company 26 (38.7 ) (14.5 )
Cash flows from financing activities 36.3 91.8
Effect of exchange rate changes 1.3 1.6
Net increase in cash and cash equivalents 205.5 117.8
Cash and cash equivalents at 1st January 286.6 168.8
Cash and cash equivalents at 31st December 27f 492.1 286.6
Annual Report 2007 31

Principal Accounting Policies
A Basis of preparation
The financial statements have been prepared in accordance with International Financial Reporting Standards,
including International Accounting Standards and Interpretations adopted by the International Accounting
Standards Board. The financial statements have been prepared under the historical cost convention except as
disclosed in the accounting policies below.
In 2007, the Group adopted the following standards and interpretations to existing standards which are relevant
to its operations:
IFRS 7 Financial Instruments: Disclosures
Amendment to IAS 1 Capital Disclosures
IFRIC 8 Scope of IFRS 2
IFRIC 9 Reassessment of Embedded Derivatives
IFRIC 10 Interim Financial Reporting and Impairment
IFRS 7, Financial Instruments: Disclosures introduces new disclosures relating to financial instruments. The
complementary amendment to IAS 1, Presentation of Financial Statements – Capital Disclosures introduces
disclosures about the level of an entity’s capital and how it manages capital. These standards do not have any
impact on the classification and valuation of the Group’s financial instruments.
IFRIC 8, Scope of IFRS 2 requires consideration of transactions involving the issuance of equity instruments –
where the identifiable consideration received is less than the fair value of the equity instruments issued – to
establish whether or not they fall within the scope of IFRS 2. Application of this interpretation is not expected
to have significant impact to the Group.
IFRIC 9, Reassessment of Embedded Derivatives prohibits reassessment of any embedded derivatives contained
in a contract since becoming a party to the contract unless there is a change in the terms of the host contract
that significantly modifies the cash flows that otherwise would be required under the contract, in which case
reassessment is required. Application of this interpretation is not expected to have significant impact to the Group.
IFRIC 10, Interim Financial Reporting and Impairment prohibits the impairment losses recognized in an interim
period in respect of goodwill, investments in equity instruments and investments in financial assets carried at cost
from being reversed at a subsequent balance sheet date. Application of this interpretation is not expected to have
significant impact to the Group.
There have been no changes to the accounting policies as a result of adoption of the above standards and
interpretations.
Certain comparative figures in the segmental disclosure have been reclassified to conform with current year
presentation.
The following standards and interpretations to existing standards, which are relevant to the Group’s operations,
were published but are not yet effective in 2007:
IFRS 3, Business Combinations (effective for annual periods beginning on or after 1st July 2009), which
replaces IFRS 3 (as issued in 2004), and the related amendment to IAS 27, Consolidated and Separate Financial
Statements (effective for annual periods beginning on or after 1st July 2009) provide guidance for applying the
acquisition method for business combinations. The Group will apply IFRS 3 and IAS 27 (as amended in 2008)
from 1st January 2010 and will revise its accounting policy on business combinations accordingly.
32 Mandarin Oriental International Limited

A Basis of preparation continued
IFRS 8, Operating Segments (effective for annual periods beginning on or after 1st January 2009) supersedes
IAS 14, Segment Reporting and requires the reporting of financial and descriptive information about an entity’s
reportable segments on the basis of internal reports that are regularly reviewed by its management. The Group
assessed the impact of IFRS 8 and concluded that the main additional disclosures will be an analysis of the Group’s
non current assets by geographical area. The Group will apply IFRS 8 from 1st January 2009.
IAS 1, Presentation of Financial Statements (effective for annual periods beginning on or after 1st January 2009)
replaces IAS 1 (revised in 2003) as amended in 2005 and sets overall requirements for the presentation of financial
statements, guidelines for their structure and minimum requirement for their content. The Group will apply IAS 1
from 1st January 2009.
IAS 23, Borrowing Costs (effective for annual periods beginning on or after 1st January 2009) supersedes IAS 23
(revised 1993) and requires the capitalization of borrowing costs relating to qualifying assets. The Group will
apply IAS 23 from 1st January 2009 but there will be no impact on the results of the Group, as the Group was
already following a policy of capitalizing borrowing costs directly attributable to the acquisition, construction
and production of a qualifying asset.
Amendments to IFRS 2, Share-based Payment – Vesting Conditions and Cancellations (effective for annual
periods beginning on or after 1st January 2008) clarify the definition of vesting conditions and provide
guidance on the accounting treatment of cancellations by parties other than the entity. The Group will apply
the amendments to IFRS 2 from 1st January 2008 but it is not expected to have any significant impact on the
results of the Group.
IFRIC 11, IFRS 2 – Group and Treasury Share Transactions (effective for annual periods beginning on or after
1st March 2007) addresses the accounting for share-based payment transactions involving two or more entities
within a group. The Group will apply IFRIC 11 from 1st January 2008, but it is not expected to have any
significant impact on the results of the Group.
IFRIC 13, Customer Loyalty Programmes (effective for annual periods beginning on or after 1st July 2008)
addresses the accounting by entities that grant loyalty award credits to customers who buy goods or services.
Specifically it explains how such entities should account for their obligation to provide free or discounted goods
to customers who redeem award credits. The Group will apply IFRIC 13 from 1st January 2009, but it is not
expected to have any significant impact on the results of the Group.
IFRIC 14, IAS 19 – The Limit on a Defined Benefit Asset, Minimum Funding Requirements and their Interaction
(effective for annual periods beginning on or after 1st January 2008) provides general guidance on how to assess
the limit in IAS 19 on the amount of surplus in a pension plan that can be recognized as an asset by the employer
under a defined benefit plan. It also explains how the pension asset or liability may be affected when there is a
statutory or contractual minimum funding requirement. The Group will apply IFRIC 14 from 1st January 2008,
but it is not expected to have any significant impact on the results of the Group.
The principal operating subsidiaries, associates and joint ventures have different functional currencies in line
with the economic environments of the locations in which they operate. The functional currency of the Company
is United States dollars. The consolidated financial statements are presented in United States dollars.
The Group’s reportable segments are set out in note 1.
Annual Report 2007 33

Principal Accounting Policies Continued
B Basis of consolidation
i) The consolidated financial statements include the financial statements of the Company, its subsidiary
undertakings and, on the basis set out in (ii) below, its associates and joint ventures. Subsidiary undertakings
are entities over which the Group has the power to govern the financial and operating policies. The results of
subsidiary undertakings, associates and joint ventures are included or excluded from their effective dates of
acquisition or disposal respectively. All material intercompany transactions, balances and unrealized surpluses
and deficits on transactions between Group companies have been eliminated. The cost of and related income
arising from shares held in the Company by subsidiary undertakings are eliminated from shareholders’ funds
and minority interests, and profit respectively.
ii) Associates are entities, not being subsidiary undertakings or joint ventures, over which the Group exercises
significant influence. Joint ventures are entities which the Group jointly controls with one or more other
venturers. Associates and joint ventures are included on the equity basis of accounting.
iii) Minority interests represent the proportion of the results and net assets of subsidiary undertakings and their
associates and joint ventures not attributable to the Group.
iv) The results of entities other than subsidiary undertakings, associates and joint ventures are included only to the
extent of dividends received.
C Foreign currencies
Transactions in foreign currencies are accounted for at the exchange rates ruling at the transaction dates.
Assets and liabilities of subsidiary undertakings, associates and joint ventures, together with all other monetary
assets and liabilities expressed in foreign currencies are translated into United States dollars at the rates of exchange
ruling at the year end. Results expressed in foreign currencies are translated into United States dollars at the
average rates of exchange ruling during the year.
Exchange differences arising from the retranslation of the net investment in foreign subsidiary undertakings,
associates and joint ventures, and of financial instruments which are designated as hedges of such investments, are
taken directly to exchange reserves. On the disposal of these investments, such exchange differences are recognized
in the consolidated profit and loss account as part of the profit or loss on disposal. Exchange differences on other
non-current investments are dealt with in reserves as part of the gains and losses arising from changes in their fair
value. All other exchange differences are dealt with in the consolidated profit and loss account.
Goodwill and fair value adjustments arising on acquisition of a foreign entity after 1st January 2003 are treated as
assets and liabilities of the foreign entity and translated into United States dollars at the rate of exchange ruling at
the year end.
D Impairment
Assets that have indefinite useful lives are not subject to amortization and are tested for impairment annually
and whenever there is an indication that the assets may be impaired. Assets that are subject to amortization are
reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount may not
be recoverable. Cash-generating units to which goodwill has been allocated are tested for impairment annually and
whenever there is an indication that the units may be impaired. An impairment loss is recognized for the amount
by which the carrying amount of the asset exceeds its recoverable amount, which is the higher of an asset’s fair
value less costs to sell and value in use. For the purpose of assessing impairment, assets are grouped at the lowest
level for which there are separately identifiable cash flows.
34 Mandarin Oriental International Limited

E Intangible assets
i) Goodwill represents the excess of the cost of an acquisition over the fair value of the Group’s share of the net
identifiable assets of the acquired subsidiary undertakings, associate or joint venture at the effective date of
acquisition, and, in respect of an increase in holding in a subsidiary undertakings, the excess of the cost of
acquisition over the carrying amount of the proportion of the minority interests acquired. If the cost of
acquisition is less than the fair value of the net assets acquired or the carrying amount of the proportion of the
minority interests acquired, the difference is recognized directly in the consolidated profit and loss account.
Goodwill on acquisitions of subsidiary undertakings is included in intangible assets. Goodwill on acquisitions
of associates and joint ventures is included in investment in associates and joint ventures. Goodwill is allocated
to cash-generating units for the purpose of impairment testing and is carried at cost less accumulated
impairment loss.
The profit or loss on disposal of subsidiary undertakings, associates and joint ventures includes the carrying
amount of goodwill relating to the entity sold.
ii) Land use rights are payments to third parties to acquire long-term interests in owner-occupied property. These
payments are stated at cost and are amortized over the useful life of the lease which includes the renewal period
if the lease can be renewed without significant cost.
iii) Computer software represents acquired computer software licences which are capitalized on the basis of the
costs incurred to acquire and bring to use the specific software. These costs are amortized over their estimated
useful lives.
F Tangible fixed assets and depreciation
Freehold land and buildings, and the building component of owner-occupied leasehold properties are stated
at valuation. Independent valuations are performed every three years on an open market basis and, in the case
of the building component of leasehold properties, on the basis of depreciated replacement cost. Depreciated
replacement cost is used as the most reliable basis of allocating open market value to the building component.
In the intervening years, the Directors review the carrying values and adjustment is made where there has been
a material change. Revaluation surpluses and deficits are dealt with in property revaluation reserves except for
movements on individual properties below depreciated cost which are dealt with in the consolidated profit and
loss account. Grants related to tangible fixed assets are deducted in arriving at the carrying amount of the assets.
Other tangible fixed assets are stated at cost less amounts provided for depreciation.
Depreciation is calculated on the straight-line basis to allocate the cost or valuation of each asset to its residual
value over its estimated useful life. The residual values and useful lives are reviewed at each balance sheet date.
The estimated useful lives and principal rates in use are as follows:
Freehold land –
Freehold and long leasehold buildings 21 years to 150 years
Properties on leases with less than 20 years over unexpired period of lease
Surface finishes and services 20 years to 30 years
Leasehold improvements 10%
Plant and machinery 6.7% – 10%
Furniture and equipment 10 – 33.3%
No depreciation is provided on freehold land as it is deemed to have an indefinite life.
Annual Report 2007 35

Principal Accounting Policies Continued
F Tangible fixed assets and depreciation continued
Where the carrying amount of a tangible fixed asset is greater than its estimated recoverable amount, it is written
down immediately to its recoverable amount.
The profit or loss on disposal of tangible fixed assets is recognized by reference to their carrying amount.
The cost of maintenance and repairs of the buildings is charged to the consolidated profit and loss account as
incurred.
G Leases
Leases are classified as finance leases when the terms of the lease transfer substantially all the risks and rewards of
ownership to the lessee. All other leases are classified as operating leases.
Payments made under operating leases (net of any incentives received from the lessor) are charged to the
consolidated profit and loss account on a straight line basis over the period of the lease. When a lease is terminated
before the lease period has expired, any payment required to be made to the lessor by way of penalty is recognized
as an expense in the year in which termination takes place.
H Loan receivables
Loan receivables are non-derivative financial assets with fixed or determinable payments that are not quoted in an
active market. They are included in current assets, except for maturities greater than 12 months after the balance
sheet date which are classified as non-current assets. Loan receivables are carried at amortized cost using the
effective interest method.
I Other investments
Other investments are non-financial assets and are stated at cost less provision for impairment.
J Development costs
Costs directly attributable to development projects, including borrowing costs, are capitalized to the extent that
such expenditure is expected to generate future economic benefits and upon completion of the project are included
in non-current assets.
K Stocks
Stocks, which principally comprise beverages and consumables, are stated at the lower of cost and net realizable
value. Cost is determined by the first-in, first-out method.
L Debtors
Debtors are measured at amortized cost using the effective interest method. Provision for impairment is
established when there is objective evidence that the outstanding amounts will not be collected or by reference to
historical loss experience. Significant financial difficulties of the debtor, probability that the debtor will enter
bankruptcy or financial reorganization, and default or delinquency in payments are considered indicators that the
debtor is impaired. The carrying amount of the asset is reduced through the use of an allowance account and the
amount of the loss is recognized in arriving at operating profit. When a debtor is uncollectible, it is written off
against the allowance account. Subsequent recoveries of amount previously written off are credited in the profit
and loss account. Debtors with maturities greater than twelve months after the balance sheet date are classified
under non-current assets.
36 Mandarin Oriental International Limited

M Cash and cash equivalents
For the purposes of the cash flow statement, cash and cash equivalents comprise deposits with banks and financial
institutions and bank and cash balances, net of bank overdrafts. In the balance sheet, bank overdrafts are included
in current borrowings.
N Provisions
Provisions are recognized when the Group has present legal or constructive obligations as a result of past events,
it is probable that an outflow of resources embodying economic benefits will be required to settle the obligations,
and a reliable estimate of the amount of the obligations can be made.
O Borrowings and borrowing costs
Borrowings are initially recognized at fair value, net of transaction costs incurred. In subsequent periods,
borrowings are stated at amortized cost using the effective interest method.
Borrowing costs relating to major development projects are capitalized until the asset is substantially completed.
Capitalized borrowing costs are included as part of the cost of the asset. All other borrowing costs are expensed
as incurred.
Borrowings are classified under non-current liabilities unless their maturities are within twelve months after the
balance sheet date.
P Government grants
Grants from governments are recognized at their fair value when there is reasonable assurance that the grant will be
received and the Group will comply with all attached conditions.
Grants relating to the development of hotel property are deducted in arriving at the carrying amount of the hotel
property.
Q Deferred tax
Deferred tax is provided, using the liability method, for all temporary differences arising between the tax bases of
assets and liabilities and their carrying values.
Provision for deferred tax is made on the revaluation of certain non-current assets and, in relation to acquisitions,
on the difference between the fair values of the net assets acquired and their tax base. Provision for withholding tax
which could arise on the remittance of retained earnings relating to subsidiary undertakings is only made where
there is a current intention to remit such earnings.
Deferred tax assets relating to the carry forward of unused tax losses are recognized to the extent that it is probable
that future taxable profit will be available against which the unused tax losses can be utilized.
Annual Report 2007 37

Principal Accounting Policies Continued
R Employee benefits
i) Pension obligations
The Group operates a number of defined benefit and defined contribution plans, the assets of which are held in
trustee administered funds.
Pension accounting costs for defined benefit plans are assessed using the projected unit credit method. Under
this method, the costs of providing pensions are charged to the consolidated profit and loss account spreading
the regular cost over the service lives of employees in accordance with the advice of qualified actuaries, who
carry out a full valuation of major plans every year. The pension obligations are measured as the present value
of the estimated future cash outflows by reference to market yields on high quality corporate bonds which
have terms to maturity approximating the terms of the related liability. Plan assets are measured at fair value.
Actuarial gains and losses are recognized in full in the year in which they occur, outside the consolidated profit
and loss account, in the consolidated statement of recognized income and expense.
The Group’s total contributions relating to the defined contribution plans are charged to the consolidated
profit and loss account in the year to which they relate.
ii) Share-based compensation
The Group has a Senior Executive Share Incentive Scheme in order to provide selected executives with options
to purchase ordinary shares in the Company.
The fair value of the employee services received in exchange for the grant of the options in respect of options
granted after 7th November 2002 is recognized as an expense. The total amount to be expensed over the
vesting period is determined by reference to the fair value of the options granted. At each balance sheet date,
the Group revises its estimates of the number of options that are expected to become exercisable. The impact
of the revision of original estimates, if any, is recognized in the consolidated profit and loss account.
S Dividends
Dividends proposed or declared after the balance sheet date are not recognized as a liability at the balance sheet
date.
T Revenue recognition
Revenue is measured at the fair value of the consideration received and receivable and represents amounts
receivable for goods and services provided in the normal course of business, net of discounts and sales related taxes.
Revenue from hotel ownership comprises amounts earned in respect of services, facilities and goods supplied
by the subsidiary hotels. Revenue from the rendering of services is recognized when services are performed,
provided that the amount can be measured reliably. Revenue from the sale of goods is recognized on the transfer
of significant risks and rewards of ownership, which generally coincides with the time when the goods are delivered
to customers and title has passed.
Revenue from hotel management comprises gross fees earned from the management of all the hotels operated by
the Group.
Management fees charged to the subsidiary hotels are eliminated upon consolidation.
Dividend income is recognized when the right to receive payment is established.
38 Mandarin Oriental International Limited

U Derivative financial instruments
The Group only enters into derivative financial instruments in order to hedge underlying exposures. Derivative
financial instruments are initially recognized at fair value on the date a derivative contract is entered into and are
subsequently remeasured at their fair value. The method of recognizing the resulting gain or loss is dependent on
the nature of the item being hedged. The Group designates certain derivatives as either a hedge of the fair value of
a recognized asset or liability (fair value hedge), or a hedge of a forecasted transaction or of the foreign currency
risk on a firm commitment (cash flow hedge), or a hedge of a net investment in a foreign entity.
Changes in the fair value of derivatives that are designated and qualify as cash flow hedges and that are highly
effective, are recognized in hedging reserves. Where the forecasted transaction or firm commitment results in
the recognition of a non-financial asset or of a non-financial liability, the gains and losses previously deferred in
hedging reserves are transferred from hedging reserves and included in the initial measurement of the cost of the
asset or liability. Otherwise, amounts deferred in hedging reserves are transferred to the consolidated profit and
loss account and classified as income or expense in the same periods during which the hedged firm commitment
or forecasted transaction affects the consolidated profit and loss account. When a hedging instrument expires or
is sold, or when a hedge no longer meets the criteria for hedge accounting, any cumulative gain or loss existing in
hedging reserves at that time remains in the hedging reserves and is recognized when the committed or forecasted
transaction ultimately is recognized in the consolidated profit and loss account. When a committed or forecasted
transaction is no longer expected to occur, the cumulative gain or loss that was reported in hedging reserves is
immediately transferred to the consolidated profit and loss account.
Certain derivative transactions, while providing effective economic hedges under the Group’s risk management
policies, do not qualify for hedge accounting under the specific rules in IAS 39. Changes in the fair value of any
derivative instruments that do not qualify for hedge accounting under IAS 39 are recognized immediately in the
consolidated profit and loss account.
Hedges of net investments in foreign entities are accounted for on a similar basis to that used for cash flow hedges.
Any gain or loss on the hedging instrument relating to the effective portion of the hedge is recognized in exchange
reserves; the gain or loss relating to the ineffective portion is recognized immediately in the consolidated profit and
loss account.
The fair value of derivatives which are designated and qualified as effective hedges are classified as non-current
assets or liabilities if the remaining maturities of the hedged assets or liabilities are greater than twelve months after
the balance sheet date.
V Earnings per share
Basic earnings per share are calculated on profit attributable to shareholders and on the weighted average
number of shares in issue during the year. The weighted average number excludes the shares held by the Trustee
under the Senior Executive Share Incentive Schemes. For the purpose of calculating diluted earnings per share,
profit attributable to shareholders is adjusted for the effects of the conversion of dilutive potential ordinary shares,
and the weighted average number of shares is adjusted for the number of shares which are deemed to be issued
for no consideration under the Senior Executive Share Incentive Schemes based on the average share price during
the year.
Annual Report 2007 39

Principal Accounting Policies Continued
W Non-current assets classified as held for sale
Non-current assets are classified as held for sale and stated at the lower of carrying amount and fair value less
costs to sell if their carrying amount is recovered principally through a sale transaction rather than through
continuing use.
X Financial guarantee contracts
Financial guarantee contracts under which the Group accepts significant risk from a third party by agreeing
to compensate that party on the occurrence of a specified uncertain future event are accounted for in a manner
similar to insurance contracts. Provisions are recognized when it is probable that the Group has obligations
under such guarantees and an outflow of resources embodying economic benefits will be required to settle
the obligations.
40 Mandarin Oriental International Limited

Financial Risk Management
A Financial risk factors
The Group’s activities expose it to a variety of financial risks: market risk (including foreign exchange risk and
interest rate risk), credit risk and liquidity risk.
The Group’s treasury function co-ordinates, under the directions of the Board of Mandarin Oriental Hotel
Group International Limited, financial risk management policies and their implementation. The Group’s treasury
policies are designed to manage the financial impact of fluctuations in interest rates and foreign exchange rates and
to minimise the Group’s financial risks. The Group uses derivative financial instruments, principally interest rate
swaps and caps, and forward foreign exchange contracts as appropriate for hedging transactions and managing the
Group’s assets and liabilities in accordance with the Group’s financial risk management policies. It is the Group’s
policy not to enter into derivative transactions for speculative purposes. The notional amounts and fair values of
derivative financial instruments at 31st December 2007 are disclosed in note 28.
i) Market risk
Foreign exchange risk
Entities within the Group are exposed to foreign exchange risk from future commercial transactions, net
investments in foreign operations and net monetary assets and liabilities that are denominated in a currency
that is not the entity’s functional currency.
Group companies are required to manage their foreign exchange risk against their functional currency. To
manage their foreign exchange risk arising from future commercial transactions, entities in the Group use
forward foreign exchange contracts and foreign currency options in a consistent manner to hedge firm and
anticipated foreign exchange commitments. Forward foreign exchange contracts may also be used to hedge
net investments in foreign operations where the currency concerned is anticipated to be volatile, the exposure
of the Group is material and the hedging is cost effective. Foreign currency borrowings are required to be
swapped into the entity’s functional currency using cross-currency swaps except where the foreign currency
borrowings are repaid with cash flows generated in the same foreign currency. The purpose of these hedges is
to mitigate the impact of movements in foreign exchange rates on assets and liabilities and the profit and loss
account of the Group.
At 31st December 2007, if the United States dollar had strengthened/weakened by 10% against the Pound
Sterling with all other variables held constant, the Group’s profit after tax and total equity would have been
US$0.3 million (2006: US$0.2 million) lower/higher, arising from foreign exchange losses/gains taken to the
profit and loss account on translation. The sensitivity analysis has been determined assuming that the change
in foreign exchange rates had occurred at the balance sheet date and all other variables, in particular interest
rates, had remained constant. The stated change represents management’s assessment of reasonably possible
changes in foreign exchange rates over the period until the next annual balance sheet date. There are no other
significant monetary balances held by Group companies at 31st December 2007 that are denominated in
a non-functional currency. Currency risks as defined by IFRS 7 arise on account of monetary assets and
liabilities being denominated in a currency that is not the functional currency; differences resulting from the
translation of financial statements into the Group’s presentation currency are not taken into consideration.
Annual Report 2007 41

Financial Risk Management Continued
A Financial risk factors continued
i) Market risk continued
Interest rate risk
The Group is exposed to interest rate risk through the impact of rate changes on interest bearing liabilities
and assets. These exposures are managed partly by using natural hedges that arise from offsetting interest rate
sensitive assets and liabilities, and partly through the use of derivative financial instruments such as interest
rate swaps, caps and collars. The Group monitors interest rate exposure on a monthly basis by currency and
business unit, taking into consideration proposed financing and hedging arrangements. The Group’s guideline
is to maintain 40% – 60% of its borrowings, in fixed rate instruments with an average tenor of less than
1 to 7 years. At 31st December 2007 the Group’s interest rate hedge was 49% (2006: 46%), with an average
tenor of 2.9 years (2006: 2.4 years). The interest rate profile of the Group’s borrowings after taking into
account hedging transactions are set out in note 17.
Cash flow interest rate risk is the risk that changes in market interest rates will impact cash flows arising from
variable rate financial instruments. Borrowings at floating rates therefore expose the Group to cash flow interest
rate risk. The Group manages this risk by using forward rate agreements to a maturity of one year, and by
entering into interest rate swaps and caps for a maturity of up to seven years. Forward rate agreements and
interest rate swaps have the economic effect of converting borrowings from floating rate to fixed rate, caps
provide protection against a rise in floating rates above a pre-determined rate, whilst collars combine the
purchase of a cap and the sale of a floor to specify a range in which an interest rate will fluctuate.
At 31st December 2007, if interest rates had been 100 basis points higher/lower with all other variables held
constant, the Group’s profit after tax would have been US$0.1 million (2006: US0.5 million) lower/higher
and hedging reserves would have been US$3.8 million (2006: US$3.6 million) lower/higher, as a result of
a decrease/increase in interest expense on variable rate borrowings and movements in the hedging reserves
caused by fair value changes to cash flow hedges. The sensitivity analysis has been determined assuming that
the change in interest rates had occurred at the balance sheet date and had been applied to the exposure to
interest rate risk for both derivative and non-derivative financial instruments in existence at that date. The
100 basis point increase or decrease represents management’s assessment of a reasonable possible change in
those interest rates which have the most impact on the Group, specifically the United States, Hong Kong and
UK rates, over the period until the next annual balance sheet date. In the case of effective fair value hedges,
changes in fair value caused by interest rate movements balance out in the profit and loss account against
changes in the fair value of the hedged item. Changes in the market interest rate of financial instruments that
were designated as hedging instruments in a cash flow hedge to hedge payment fluctuations resulting from
interest rate movements affect the hedging reserves and are therefore taken into consideration in the
equity-related sensitivity calculations. Changes in market interest rates affect the interest income or expense
of non-derivative variable-interest financial instruments, the interest payments of which are not designated
as hedged items of cash flow hedges against interest rate risks. As a consequence, they are included in the
calculation of profit after tax sensitivities.
42 Mandarin Oriental International Limited

A Financial risk factors continued
ii) Credit risk
The Group’s credit risk is primarily attributable to deposits with banks, credit exposures to customers and
derivative financial instruments with a positive fair value. The Group has credit policies in place and the
exposures to these credit risks are monitored on an ongoing basis.
The Group manages its cash balances with banks and financial institutions and transactions involving
derivative financial instruments by monitoring credit ratings and limiting the aggregate risk to any individual
counterparty. The utilization of credit limits is regularly monitored. At 31st December 2007 cash balances
with banks and financial institutions amounted to US$492 million (2006: US$287 million), of which
over 99% (2006: 99%) were made to financial institutions with credit ratings of no less than A- (Fitch).
Similarly transactions involving derivative financial instruments are with banks with sound credit ratings. At
31st December 2007 the fair value of derivative financial instruments receivable amounted to US$0.2 million
(2006: US$2.9 million). Management does not expect any counterparty to fail to meet its obligations.
In respect of credit exposures to customers, the Group has policies in place to ensure that sales on credit
without collateral are made principally to travel agents and corporate companies with an appropriate credit
history. Sales to other customers are made in cash or via major credit cards.
The maximum exposure to credit risk is represented by the carrying amount of each financial asset in the
balance sheet after deducting any impairment allowance. The Group’s exposure to credit risk arising from
debtors is set out in note 15 and totals US$69.3 million (2006: US$65.7 million). The Group’s exposure to
credit risk arising from exposure to derivative financial instruments with a positive fair value is disclosed in
note 15 as a component of other debtors and totals US$0.1 million (2006: nil). The Group’s exposure to credit
risk arising from bank balances totals US$492 million (2006: US$287 million).
iii)Liquidity risk
Prudent liquidity risk management includes managing the profile of debt maturities and funding sources,
maintaining sufficient cash and marketable securities, and ensuring the availability of funding from an
adequate amount of committed credit facilities and the ability to close out market positions. The Group’s
ability to fund its existing and prospective debt requirements is managed by maintaining diversified funding
sources with adequate committed funding lines from high quality lenders.
At 31st December 2007, total available borrowing facilities amounted to US$848 million
(2006: US$754 million) of which US$677 million (2006: US$601 million) was drawn down. Undrawn
committed facilities, in the form of revolving credit and term loan facilities, totaled US$171 million
(2006: US$153 million) in addition to its cash balances of US$492 million (2006: US$287 million).
An ageing analysis of the Group’s financial liabilities based on the remaining period at the balance sheet to the
contractual maturity dates is included in notes 16, 17 and 28.
Annual Report 2007 43

Financial Risk Management Continued
B Capital management
The Group’s objectives when managing capital are to safeguard the Group’s ability to continue as a going concern
whilst seeking to maximize benefits to shareholders and other stakeholders.
The Group actively and regularly reviews and manages its capital structure to ensure optimal capital structure and
shareholder returns, taking into consideration the future capital requirements of the Group and capital efficiency,
prevailing and projected profitability, projected operating cash flows, projected capital expenditures and projected
strategic investment opportunities. In order to maintain or adjust the capital structure, the Group may adjust the
amount of dividends paid to shareholders, purchase Group shares, return capital to shareholders, issue new shares
or sell assets to reduce debt.
The Group monitors capital on the basis of the Group’s consolidated gearing ratio and consolidated interest cover.
The gearing ratio is calculated as net debt divided by total equity. Net debt is calculated as total borrowings less
bank balances and other liquid funds. Interest cover is calculated as operating profit (excluding gains on disposal
and the writeback of impairment) before interest and tax (including the Group’s share of operating profit from
associates and joint ventures) divided by net financing charges (including the Group’s share of net financing
charges from associates and joint ventures). The Group does not have a defined gearing or interest cover
benchmark or range.
The ratios at 31st December 2007 and 2006 based on IFRS balance sheets are as follows:
2007 2006
Gearing ratio 16% 31%
Interest cover 5.6 2.9
The increase in interest cover for the year ended 2007 compared with 2006 was primarily due to strong cash flows
generated by Group companies. This has also contributed to the decrease in the gearing ratio for the year then
ended which was also positively impacted by other changes in reserves including the revaluation surplus.
C Fair value estimation
The fair value of listed investments is based on quoted market prices. The quoted market price used for listed
investments held by the Group is the current bid price.
The fair values of current debtors, bank balances and other liquid funds, current creditors, current borrowings,
and current provisions are assumed to approximate their carrying amount due to the short-term maturities of these
assets and liabilities.
The fair values of long-term borrowings are based on market prices or are estimated using the expected future
payments discounted at market interest rates.
The fair value of interest rate swaps and caps is calculated by reference to the present value of the estimated future
cash flows, taking into account current interest rates as observed from the market.
44 Mandarin Oriental International Limited

Critical Accounting Estimates and Judgements
Estimates and judgements used in preparing the financial statements are continually evaluated and are based on
historical experience and other factors, including expectations of future events that are believed to be reasonable.
The resulting accounting estimates will, by definition, seldom equal the related actual results. The estimates and
assumptions that have a significant effect on the carrying amounts of assets and liabilities are discussed below:
i) Impairment of assets
The Group tests annually whether goodwill and other assets that have indefinite useful lives suffered any
impairment. Other assets are reviewed for impairment whenever events or changes in circumstances indicate
that the carrying amount of the asset exceeds its recoverable amount. The recoverable amount of an asset or a cash
generating unit is determined based on the higher of its fair value less cost to sell and value in use, calculated on
the basis of management’s assumptions and estimates. Changing the key assumptions, including the discount rates
or the growth rate assumptions in the cash flow projections, could materially affect the value-in-use calculations.
In determining when an investment is other-than-temporarily impaired, significant judgement is required. In
making this judgement, the Group evaluates, among other factors, the duration and extent to which the fair value
of an investment is less than its cost; and the financial health of and near-term business outlook for the investee,
including factors such as industry and sector performance, changes in technology and operational and financing
cash flow.
ii) Property valuation
In arriving at the fair value of the properties, which is determined by using the income capitalization approach for
existing use basis, the independent valuers have to make assumptions that are mainly based on market conditions
existing at the balance sheet date and appropriate capitalization rates. Should these assumptions and estimates
change, or not be met, the valuation as adopted in the financial statements will be affected.
iii)Tangible fixed assets and depreciation
Freehold land and buildings, and the building component of owner-occupied leasehold properties are valued every
three years by independent valuers. In the intervening years the Group reviews the carrying values and adjustment
is made where there has been a material change. In arriving at the valuation of land and buildings, assumptions
and economic estimates have to be made.
Management determines the estimated useful lives and related depreciation charges for the Group’s tangible fixed
assets. Management will revise the depreciation charge where useful lives are different to previously estimated, or
it will write-off or write-down technically obsolete or non-strategic assets that have been abandoned or sold.
iv) Income taxes
The Group is subject to income taxes in numerous jurisdictions. Significant judgement is required in determining
the worldwide provision for income taxes. There are many transactions and calculations for which the ultimate tax
determination is uncertain during the ordinary course of business. Where the final tax outcome of these matters is
different from the amounts that were initially recorded, such differences will impact the income tax and deferred
tax provisions in the period in which such determination is made.
Recognition of deferred tax assets, which principally relate to tax losses, depends on the management’s expectation
of future taxable profit that will be available against which the tax losses can be utilized. The outcome of their
actual utilization may be different.
Annual Report 2007 45

Critical Accounting Estimates and Judgements Continued
v) Pension obligations
The present value of the pension obligations depends on a number of factors that are determined on an actuarial
basis using a number of assumptions. The assumptions used in determining the net cost (income) for pensions
include the expected long-term rate of return on the relevant plan assets and the discount rate. Any changes in
these assumptions will impact the carrying amount of pension obligations.
The expected return on plan assets assumption is determined on a uniform basis, taking into consideration longterm
historical returns, asset allocation and future estimates of long-term investment returns.
The Group determines the appropriate discount rate at the end of each year. This is the interest rate that should be
used to determine the present value of estimated future cash outflows expected to be required to settle the pension
obligations. In determining the appropriate discount rate, the Group considers the interest rates of high-quality
corporate bonds that are denominated in the currency in which the benefits will be paid, and that have terms to
maturity approximating the terms of the related pension liability.
Other key assumptions for pension obligations are based in part on current market conditions.
46 Mandarin Oriental International Limited

Notes to the Financial Statements
1 Revenue
2007 2006
US$m US$m
Analysis by geographical area
– Hong Kong and Macau 200.8 106.3
– Other Asia 119.3 111.0
– Europe 146.4 123.3
– The Americas 63.0 64.0
529.5 404.6
Analysis by activity
– Hotel ownership 509.5 383.8
– Hotel management 48.1 38.7
– Less: Intra-Group revenue (28.1 ) (17.9 )
529.5 404.6
The Group considers its primary reporting segment to be geographic. The Group is operated on a worldwide basis in
four regions: Hong Kong and Macau, Other Asia, Europe and The Americas. In addition, the Group has two distinct
business segments: hotel ownership and hotel management. The Group’s segmental information is more fully
described in note 19.
2 Operating profit
Restated
2007 2006
US$m US$m
Analysis by geographical area
– Hong Kong and Macau 54.2 (1.8 )
– Other Asia 3.6 9.0
– Europe 47.0 28.4
– The Americas 2.9 9.5
107.7 45.1
– Gain on disposal of The Mark (refer note 5) – 76.8
107.7 121.9
Analysis by activity
– Hotel ownership 92.4 33.7
– Hotel management 15.3 11.4
107.7 45.1
– Gain on disposal of The Mark (refer note 5) – 76.8
107.7 121.9
The operating profit from hotel management in 2006 has been restated to reflect the reallocation of Group
management costs related to hotel ownership and the corporate function from hotel management activities where
they were previously reported.
Annual Report 2007 47

Notes to the Financial Statements Continued
2 Operating profit continued
48 Mandarin Oriental International Limited
2007 2006
US$m US$m
The following items have been (credited)/charged in arriving at operating profit:
Rental income (9.4 ) (4.7 )
Interest income from mezzanine loans (1.7 ) (4.5 )
Depreciation of tangible assets (refer note 10)
– Owned assets 37.6 28.4
Amortization of intangible assets (refer note 9) 0.9 0.3
Repairs and maintenance 19.8 17.0
Operating lease payments 11.4 8.5
Development costs 1.7 0.7
Directors’ remuneration 4.8 4.2
Employee benefit expense
– Salaries and benefits in kind 180.4 156.4
– Defined benefit pension costs (refer note 13) 1.2 2.0
– Defined contribution pension costs 0.5 0.6
– Share-based payments 2.7 1.7
184.8 160.7
Termination costs on hotel closure 3.1 –
Realization of exchange gain arising on repatriation of capital from
a foreign subsidiary undertaking (8.3 ) –
Net foreign exchange loss/(gains) 1.4 (1.9 )
3 Net financing charges
Company and subsidiaries
Interest income 18.9 11.0
Interest expense
– Bank loans (33.9 ) (25.1 )
– Finance leases – (0.2 )
(33.9 ) (25.3 )
Commitment and other fees (1.4 ) (0.9 )
Financing charges (35.3 ) (26.2 )
Net financing charges (16.4 ) (15.2 )

4 Share of results of associates and joint ventures
Operating Net financing Net
profit charges Tax profit/(loss)
US$m US$m US$m US$m
2007
Analysis by geographical area
– Hong Kong and Macau 5.9 (0.4 ) (1.0 ) 4.5
– Other Asia 25.3 (3.1 ) (3.9 ) 18.3
– The Americas 6.0 (5.0 ) (0.9 ) 0.1
37.2 (8.5 ) (5.8 ) 22.9
Analysis by activity
– Hotel ownership 35.6 (8.6 ) (5.2 ) 21.8
– Other 1.6 0.1 (0.6 ) 1.1
37.2 (8.5 ) (5.8 ) 22.9
2006
Analysis by geographical area
– Hong Kong and Macau 5.7 (0.4 ) (0.3 ) 5.0
– Other Asia 16.0 (3.4 ) (3.3 ) 9.3
– The Americas 7.8 (7.0 ) (2.1 ) (1.3 )
29.5 (10.8 ) (5.7 ) 13.0
Analysis by activity
– Hotel ownership 28.3 (10.8 ) (5.3 ) 12.2
– Other 1.2 – (0.4 ) 0.8
29.5 (10.8 ) (5.7 ) 13.0
Share of results of associates and joint ventures is stated after charging depreciation and amortization of
US$11.9 million (2006: US$13.1 million). It includes a US$5.1 million (2006: nil) writeback of an impairment
previously made against the value of the Group’s interest in Mandarin Oriental, Kuala Lumpur.
5 Gain on disposal of The Mark
The sale of the Group’s 100% interest in The Mark, New York was completed on 16th February 2006 for a gross
consideration of US$150 million. The hotel was originally acquired in 2000 as part of the US$142.5 million
acquisition of The Rafael Group. The pre-tax gain on this disposal was US$76.8 million, and the post-tax gain
on the disposal was US$35 million.
6 Gain on disposal related to an associate
The sale of half of the Group’s 50% investment in Mandarin Oriental, New York was completed on 1st March 2007.
This sale has reduced the Group’s interest in the hotel from 50% to 25%. The hotel was valued at US$340 million for
the purpose of the sale. On disposal of the 25% interest, the Group recorded a pre-tax gain of US$25 million, with a
post-tax gain of US$16 million after a tax charge of US$9 million arising on the disposal. The Group will continue to
manage the hotel under a long-term agreement.
Annual Report 2007 49

Notes to the Financial Statements Continued
7 Tax
50 Mandarin Oriental International Limited
2007 2006
US$m US$m
Company and subsidiaries
– Current tax 13.3 50.6
– Deferred tax (refer note 14) 9.5 (11.1 )
22.8 39.5
Analysis by geographical area
– Hong Kong and Macau 8.8 0.9
– Other Asia 4.6 (0.4 )
– Europe 6.3 5.8
– The Americas 3.1 33.2
22.8 39.5
Analysis by activity
– Hotel ownership 17.4 37.6
– Hotel management 5.4 1.9
22.8 39.5
Reconciliation between tax expense and tax at the applicable tax rate:
Tax at applicable tax rate 18.0 37.5
(Income) expenses not (taxable) deductible for tax purposes (0.7 ) 2.3
Tax losses not recognized 4.8 3.1
Temporary differences not recognized 0.4 (0.3 )
Utilization of previously unrecognized tax losses (0.2 ) (0.9 )
Utilization of previously unrecognized temporary differences (2.4 ) (0.6 )
Recognition of previously unrecognized deferred tax assets (2.1 ) (1.3 )
Recognition of previously unrecognized temporary differences 1.8 (2.5 )
Deferred tax assets written off 0.3 0.5
Withholding tax 2.0 1.4
Under provision in prior years 1.5 0.3
Other (0.6 ) –
22.8 39.5
The applicable tax rate for the year was 17% (2006: 37%) and represents the weighted average of the rates of taxation
prevailing in the territories in which the Group operates. The decrease in the applicable tax rate is caused by a change
in the profitability of the Group’s subsidiary undertakings in the respective territories.
The 2006 tax on profits included a tax charge of US$41.8 million arising on the disposal of the Group’s 100% interest
in The Mark, New York (refer note 5).

8 Earnings per share
Basic earnings per share are calculated on the profit attributable to shareholders of US$108.2 million
(2006: US$80 million) and on the weighted average number of 969.8 million (2006: 966.6 million) shares
in issue during the year (refer principal accounting policy (v)).
Diluted earnings per share are calculated on profit attributable to shareholders of US$108.2 million
(2006: US$80 million), which is after adjusting for the effects of the conversion of dilutive potential ordinary
shares of subsidiary undertakings, associates or joint ventures, and on the weighted average number of 987.1 million
(2006: 979.3 million) shares in issue during the year (refer principal accounting policy (v)).
The weighted average number of shares is arrived at as follows:
Ordinary shares in millions
2007 2006
Weighted average number of shares in issue 987.0 989.4
Shares held by the Trustee under the Senior Executive Share Incentive Schemes (17.2 ) (22.8 )
Weighted average number of shares for basic earnings per share calculation 969.8 966.6
Adjustment for shares deemed to be issued for no consideration
under the Senior Executive Share Incentive Schemes 17.3 12.7
Weighted average number of shares for diluted earnings per share calculation 987.1 979.3
Basic and diluted earnings per share are also presented based on the profit before gains on disposal and writeback of
impairment. A reconciliation of earnings is set out below:
2007 2006
Basic Diluted Basic Diluted
earnings earnings earnings earnings
per share per share per share per share
US$m US¢ US¢ US$m US¢ US¢
Profit before gains on disposal and
writeback of impairment 87.1 8.98 8.82 45.0 4.66 4.60
Gains on disposal 16.0 35.0
Writeback of impairment 5.1 –
Profit attributable to shareholders 108.2 11.16 10.96 80.0 8.28 8.17
Annual Report 2007 51

Notes to the Financial Statements Continued
9 Intangible assets
52 Mandarin Oriental International Limited
Land use Computer
Goodwill rights software Total
US$m US$m US$m US$m
2007
Cost 23.3 195.0 0.8 219.1
Amortization – (3.0 ) (0.1 ) (3.1 )
Net book value at 1st January 23.3 192.0 0.7 216.0
Translation differences – (0.7 ) 0.1 (0.6 )
Additions – – 1.7 1.7
Amortization – (0.5 ) (0.4 ) (0.9 )
Net book value at 31st December 23.3 190.8 2.1 216.2
Cost 23.3 194.3 2.6 220.2
Accumulated amortization – (3.5 ) (0.5 ) (4.0 )
23.3 190.8 2.1 216.2
2006
Cost 23.3 195.0 – 218.3
Amortization – (2.8 ) – (2.8 )
Net book value at 1st January 23.3 192.2 – 215.5
Translation differences – (0.1 ) – (0.1 )
Additions – – 0.8 0.8
Transfer-in – 0.1 – 0.1
Amortization – (0.2 ) (0.1 ) (0.3 )
Net book value at 31st December 23.3 192.0 0.7 216.0
Cost 23.3 195.0 0.8 219.1
Accumulated amortization – (3.0 ) (0.1 ) (3.1 )
23.3 192.0 0.7 216.0
Management has performed an impairment review of the carrying amount of goodwill at 31st December 2007 and
has concluded that no impairment is required. For the purpose of impairment testing, goodwill acquired has been
allocated to the respective hotels and is reviewed for impairment based on individual hotel forecast operating
performance and cash flows. Cash flow projections for impairment reviews are based on individual hotel budgets
prepared on the basis of assumptions reflective of the prevailing market conditions, and are discounted appropriately.
Key assumptions used for value-in-use calculations include average growth rates of between 2 to 12% to extrapolate
cash flows, which may vary across the Group’s geographical locations, and are based on management expectations of
the market development; and pre-tax discount rates of between 10% to 13% applied to the cash flow projections. The
discount rates used reflect business specific risks relating to the business life-cycle and geographical location.
The amortization charges are included in cost of sales in the consolidated profit and loss account.
In 2006, the transfer-in represented leasehold land use rights reclassified from tangible assets (refer note 10).
Land use rights represent the upfront payments to acquire long-term interests in property leased by the principal
subsidiaries listed on pages 74 and 75.

10 Tangible assets
Freehold Leasehold
land & buildings & Plant & Furniture &
buildings improvements machinery equipment Total
US$m US$m US$m US$m US$m
2007
Costs or valuation 496.3 359.4 87.1 178.3 1,121.1
Depreciation (12.9 ) (73.8 ) (45.1 ) (106.8 ) (238.6 )
Net book value at 1st January 483.4 285.6 42.0 71.5 882.5
Translation differences 10.4 12.0 1.2 2.4 26.0
Additions 1.4 26.6 8.4 17.2 53.6
Disposals – – – (0.1 ) (0.1 )
Depreciation charge (3.2 ) (11.3 ) (4.5 ) (18.6 ) (37.6 )
Revaluation surplus 71.0 (0.4 ) – – 70.6
Net book value at 31st December 563.0 312.5 47.1 72.4 995.0
Cost or valuation 579.1 397.6 96.7 195.5 1,268.9
Accumulated depreciation (16.1 ) (85.1 ) (49.6 ) (123.1 ) (273.9 )
563.0 312.5 47.1 72.4 995.0
2006
Costs or valuation 415.0 247.5 71.0 161.3 894.8
Depreciation (10.2 ) (65.9 ) (42.5 ) (92.2 ) (210.8 )
Net book value at 1st January 404.8 181.6 28.5 69.1 684.0
Translation differences 31.1 18.2 1.5 1.6 52.4
Additions 0.1 98.6 14.6 16.1 129.4
Disposals – (0.1 ) – (0.1 ) (0.2 )
Transfer-out – (0.1 ) – – (0.1 )
Depreciation charge (2.7 ) (7.9 ) (2.6 ) (15.2 ) (28.4 )
Revaluation surplus 50.1 (4.7 ) – – 45.4
Net book value at 31st December 483.4 285.6 42.0 71.5 882.5
Cost or valuation 496.3 359.4 87.1 178.3 1,121.1
Accumulated depreciation (12.9 ) (73.8 ) (45.1 ) (106.8 ) (238.6 )
483.4 285.6 42.0 71.5 882.5
The Group’s freehold properties and the building component of leasehold properties were revalued at
31st December 2007 by independent, professionally qualified valuers on an open market basis. As a result, there
was an increase in the fair value of properties of US$70.6 million. After providing for deferred tax liabilities of
US$23.6 million on the revalued amounts, US$47 million has been taken to capital reserves. In 2006, there
was an increase in the fair value of properties of US$45.4 million. After providing for deferred tax liabilities of
US$11.7 million on the revalued amounts, US$33.7 million was taken to capital reserves.
Freehold land & buildings include a property valued at US$148.2 million (2006: US$110.9 million), which is stated
net of tax incremental financing of US$29.8 million (2006: US$30.6 million) (refer note 18).
If the freehold properties and the building component of leasehold properties had been included in the financial
statements at cost less depreciation, the carrying value would have been US$646.5 million (2006: US$607.5 million).
Annual Report 2007 53

Notes to the Financial Statements Continued
10 Tangible assets continued
Certain of the hotel properties are pledged as security for bank loans as shown in note 17.
The transfer-out in 2006 represented leasehold land use rights reclassified to intangible asset (refer note 9).
54 Mandarin Oriental International Limited
2007 2006
US$m US$m
Analysis of additions (including transfer in/(out)) by geographical area
– Hong Kong and Macau 27.4 113.1
– Other Asia 5.6 7.6
– Europe 18.2 7.5
– The Americas 2.4 1.1
53.6 129.3
Analysis of additions (including transfer in/(out)) by activity
– Hotel ownership 51.6 128.1
– Hotel management 2.0 1.2
53.6 129.3
Analysis of depreciation by geographical area
– Hong Kong and Macau (14.2 ) (8.8 )
– Other Asia (8.2 ) (6.8 )
– Europe (9.9 ) (8.8 )
– The Americas (5.3 ) (4.0 )
(37.6 ) (28.4 )
Analysis of depreciation by activity
– Hotel ownership (36.4 ) (27.2 )
– Hotel management (1.2 ) (1.2 )
(37.6 ) (28.4 )
11 Associates and joint ventures
Listed investment in The Oriental Hotel (Thailand) PCL 75.6 69.2
Unlisted investments in other associates 113.3 77.3
Group share of attributable net assets of associates 188.9 146.5
Joint ventures 15.7 43.5
204.6 190.0
Market value of listed investment in The Oriental Hotel (Thailand) PCL 81.8 66.6
The operating properties owned by associates and joint ventures were revalued at 31st December 2007 by
independent, professionally qualified valuers on an open market basis. As a result, the consolidated profit and loss
account includes a US$5.1 million (2006: nil) writeback of an impairment previously made against the value of
the Group’s 25% interest in Mandarin Oriental, Kuala Lumpur. In addition, the Group’s share of the underlying
revaluation surplus net of deferred tax, of US$1.6 million has been dealt with in capital reserves. In 2006, the Group’s
share of the underlying revaluation surplus net of deferred tax, of US$16.6 million was dealt with in capital reserves.

11 Associates and joint ventures continued
2007 2006
US$m US$m
The Group’s share of assets and liabilities and results of associates and joint ventures
are summarized below:
Associates
Non-current assets 373.4 247.4
Current assets 30.6 21.7
Current liabilities (33.1 ) (19.7 )
Non-current liabilities (182.0 ) (102.9 )
Attributable net assets 188.9 146.5
Revenue 116.3 76.0
Profit before tax 23.2 13.1
Net profit 18.4 9.9
Capital commitments 5.6 2.9
Contingent liabilities – –
Joint ventures
Non-current assets 24.6 111.9
Current assets 5.6 8.0
Current liabilities (6.8 ) (42.4 )
Non-current liabilities (7.7 ) (34.0 )
Attributable net assets 15.7 43.5
Revenue 20.5 66.7
Profit before tax 5.5 5.6
Net profit 4.5 3.1
Capital commitments 1.1 0.8
Contingent liabilities – –
Movements of share of attributable net assets for the year:
At 1st January 190.0 174.0
Net exchange translation differences 17.4 13.5
Share of results 17.8 13.0
Writeback of impairment of an associate 5.1 –
Dividends received (12.8 ) (12.2 )
Share of property revaluation net of tax 1.6 16.6
Fair value loss on cash flow hedges net of tax (0.1 ) –
Classified as held for sale (refer note 24) – (13.7 )
Capital distribution (refer note 27e) (14.4 ) (1.2 )
At 31st December 204.6 190.0
Annual Report 2007 55

Notes to the Financial Statements Continued
12 Loan receivables
56 Mandarin Oriental International Limited
2007 2006
US$m US$m
At 1st January 12.0 43.0
Addition 3.4 0.2
Repayment (12.0 ) –
Classified as held for sale (refer note 24) – (31.2 )
At 31st December 3.4 12.0
The balance as at 31st December 2007 principally consists of a mezzanine loan which is interest-bearing at
LIBOR+5.6% per annum with repayment on or before 22nd February 2010. The carrying amount of the loan
receivable approximates its fair value.
In 2006, the mezzanine loan of US$31.2 million to Mandarin Oriental, New York, which was interest-bearing
at 13.5% per annum as from the opening of the hotel with no fixed terms of repayment had been classified as a
non-current asset held for sale as at 31st December 2006 and has been fully repaid during 2007 pursuant to the
Group’s sale of 25% interest in the hotel.
13 Pension plans
The Group has a number of defined benefit pension plans, covering all the main territories in which it operates with
the major plans relating to employees in Hong Kong and South East Asia. Most of the pension plans are final salary
defined benefit plans and are funded. The assets of the funded plans are held independently of the Group’s assets in
separate trustee administered funds. The Group’s major plans are valued by independent actuaries annually using the
projected unit credit method.
The principal actuarial assumptions used for accounting purposes at 31st December are as follows:
2007 2006
Weighted Weighted
average average
% %
Discount rate applied to pension obligations 4.9 4.6
Expected return on plan assets 7.5 6.0
Future salary increases 5.0 5.0
The expected return on plan assets is determined on the basis of long-term average returns on global equities of 7% to
10% per annum and global bonds of 3.5% to 5.5% per annum, and the long-term benchmark allocation of assets
between equities and bonds in each plan.

13 Pension plans continued
The amounts recognized in the consolidated balance sheet are as follows:
2007 2006
US$m US$m
Fair value of plan assets 80.3 71.6
Present value of funded obligations (46.4 ) (45.7 )
33.9 25.9
Unrecognized past service cost – (0.3 )
Net pension assets 33.9 25.6
Analysis of net pension assets
Pension assets 34.0 27.1
Pension liabilities (0.1 ) (1.5 )
33.9 25.6
Movements in the fair value of plan assets
At 1st January 71.6 62.2
Expected return on plan assets 5.3 3.7
Actuarial gains 5.2 7.1
Contributions from company 0.4 0.9
Contributions from plan members 0.9 0.9
Exchange difference (0.1 ) 0.4
Benefits paid (3.2 ) (3.8 )
Transfer-in of assets 0.2 0.2
At 31st December 80.3 71.6
Movements in the present value of defined benefit obligations
At 1st January (45.7 ) (40.8 )
Current service cost (4.1 ) (3.4 )
Interest cost (2.2 ) (2.3 )
Contributions from plan members (0.9 ) (0.9 )
Actuarial gains and losses 2.4 (1.5 )
Curtailment and settlement (0.4 ) –
Exchange difference (0.1 ) (0.4 )
Benefits paid – funded 3.2 3.8
Benefits paid – unfunded 1.6 –
Transfer-in of liabilities (0.2 ) (0.2 )
At 31st December (46.4 ) (45.7 )
Annual Report 2007 57

Notes to the Financial Statements Continued
13 Pension plans continued
The analysis of the fair value of plan assets at 31st December is as follows:
58 Mandarin Oriental International Limited
2007 2006
US$m US$m
Equity instruments 48.5 51.0
Debt instruments 16.2 16.9
Other assets 15.6 3.7
The five year history of experience adjustments is as follows:
80.3 71.6
2007 2006 2005 2004 2003
US$m US$m US$m US$m US$m
Fair value of plan assets 80.3 71.6 62.2 58.4 52.8
Present value of funded obligations (46.4 ) (45.7 ) (40.8 ) (36.9 ) (34.9 )
Plan surplus 33.9 25.9 21.4 21.5 17.9
Experience adjustments on plan assets 5.1 7.1 1.9 3.8 9.1
Percentage of plan assets (%) 6.4 9.9 3.1 6.6 17.2
Experience adjustments on plan obligations 1.4 1.7 (1.2 ) 0.4 3.4
Percentage of plan obligations (%) 3.0 3.7 3.0 1.2 9.8
The net cumulative actuarial gains recorded in the Statement of Recognized Income and Expense is US$32 million
(2006: US$24.4 million).
The amounts recognized in the consolidated profit and loss account are as follows:
2007 2006
US$m US$m
Current service cost 4.1 3.4
Interest cost 2.2 2.3
Loss on curtailment and settlement 0.2 –
Expected return on plan assets (5.3 ) (3.7 )
1.2 2.0
Actual return on plan assets in the year 10.5 10.8
It is estimated that the Group will make contributions of up to 10% of pensionable salaries into the pension plans
in 2008.

14 Deferred tax
Unremitted Provisions
earnings in and other
Accelerated tax Asset Pension associates & temporary
depreciation revaluation plans joint ventures differences Losses Total
US$m US$m US$m US$m US$m US$m US$m
2007
At 1st January (restated) 25.6 37.3 4.3 1.6 (11.8 ) (11.5 ) 45.5
Exchange differences 0.9 0.7 (0.1 ) 0.3 0.2 (0.2 ) 1.8
Charged/(credited) to
consolidated profit
and loss account 11.0 – – – 0.6 (2.1 ) 9.5
Charged to equity – 22.0 1.4 – – – 23.4
At 31st December 37.5 60.0 5.6 1.9 (11.0 ) (13.8 ) 80.2
2006
At 1st January 22.0 21.8 3.5 1.3 (1.2 ) (7.5 ) 39.9
Exchange differences 0.7 3.1 – 0.2 (0.1 ) (0.6 ) 3.3
Charged/(credited) to
consolidated profit
and loss account 2.9 – (0.2 ) 0.1 (10.5 ) (3.4 ) (11.1 )
Charged to equity – 12.4 1.0 – – – 13.4
At 31st December (restated) 25.6 37.3 4.3 1.6 (11.8 ) (11.5 ) 45.5
2007 2006
US$m US$m
Deferred tax assets (27.5 ) (27.4 )
Deferred tax liabilities 107.7 72.9
80.2 45.5
Deferred tax assets of US$29.7 million (2006: US$25.4 million) have not been recognized in relation to tax losses in
subsidiaries as it is uncertain when these losses will be utilized.
Expiry dates for deferred tax assets not recognized in relation to tax losses:
Within one year 0.1 0.1
Between two and five years 0.3 0.3
Over five years 5.7 2.5
With no expiry dates 23.6 22.5
29.7 25.4
Deferred tax balances predominantly comprise non-current items.
Deferred tax assets of US$4.6 million (2006: US$2.7 million) have not been recognized in relation to temporary
differences in subsidiaries.
Deferred tax liabilities have not been established for withholding taxes that would be payable on the unremitted
earnings of certain subsidiaries as there is no current intention of remitting the retained earnings to the holding
companies.
Annual Report 2007 59

Notes to the Financial Statements Continued
15 Debtors and prepayments
60 Mandarin Oriental International Limited
2007 2006
US$m US$m
Trade debtors
– third parties 38.9 38.8
– associates and joint ventures 3.8 3.2
42.7 42.0
– provision for impairment (0.6 ) (1.2 )
42.1 40.8
Other debtors
– third parties 24.8 23.3
– associates and joint ventures 2.4 1.6
27.2 24.9
– provision for impairment – –
27.2 24.9
69.3 65.7
Other debtors are further analyzed as follows:
Other debtors 12.5 11.6
Prepayments 10.4 10.2
Amounts due from associates and joint ventures 2.4 1.6
Rental and other deposits 1.8 1.5
Interest rate swaps 0.1 –
27.2 24.9
Analysis by geographical area of operation:
Hong Kong and Macau 20.6 17.9
Other Asia 11.5 12.9
Europe 21.7 16.8
The Americas 15.5 18.1
69.3 65.7
The fair value of debtors and prepayments approximate their carrying amounts.

15 Debtors and prepayments continued
Trade debtors, net of provision for impairment, at 31st December 2007 amounted to US$42.1 million. The average
credit period on provision of services varies among Group businesses and is not more than 30 days. Before accepting
any new customer, an individual Group business assesses the potential customer’s credit quality and sets credit limits
by customer, using internal credit scoring systems. These limits and scoring are reviewed periodically.
Significant financial difficulties of the debtor, probability that the debtor will enter bankruptcy or financial
reorganization, and default or delinquency in payment are considered indicators that the debtor is impaired and
an allowance for impairment is made based on the estimated irrecoverable amount determined by reference to past
default experiences.
At 31st December 2007, trade debtors of US$1 million (2006: US$1.4 million) were impaired. The amount of the
provision was US$0.6 million (2006: US$1.2 million). The impaired debtors mainly related to a few individual travel
agents and corporate companies and do not present significant credit risk to the Group. It was assessed that a portion
of the debtors is expected to be recovered. The ageing analysis of these trade debtors is as follows:
2007 2006
US$m US$m
Below 30 days 0.2 –
Between 31 and 60 days 0.1 –
Between 61 and 90 days 0.1 0.4
Over 90 days 0.6 1.0
1.0 1.4
At 31st December 2007, trade debtors and other debtors of US$12.4 million (2006: US$12.5 million) were past due
but not impaired. The ageing analysis of these trade debtors and other debtors is as follows:
Below 30 days 6.7 6.9
Between 31 and 60 days 3.0 1.9
Between 61 and 90 days 1.3 3.0
Over 90 days 1.4 0.7
12.4 12.5
The risk of trade debtors and other debtors that are neither past due nor impaired at 31st December 2007 becoming
impaired is low as most of the balances have been settled subsequent to year end.
Movements on the provision for impairment are as follows:
Trade debtors
2007 2006
US$m US$m
At 1st January (1.2 ) (1.2 )
Unused amounts reversed 0.5 –
Bad debts written off 0.1 –
At 31st December (0.6 ) (1.2 )
Annual Report 2007 61

Notes to the Financial Statements Continued
16 Creditors and accruals
62 Mandarin Oriental International Limited
2007 2006
US$m US$m
Trade creditors 36.7 33.1
Accruals 55.7 46.7
Deposits accepted 10.7 9.4
Other creditors 2.4 1.8
105.5 91.0
Currency:
Hong Kong Dollar 48.1 41.6
Japanese Yen 10.2 11.4
Swiss Franc 7.1 4.5
United Kingdom Sterling 15.3 10.2
United States Dollar 17.2 15.7
Other 7.6 7.6
105.5 91.0
The fair value of creditors approximate their carrying amounts.
17 Borrowings
2007 2007 2006 2006
Carrying Fair Carrying Fair
amount value amount value
US$m US$m US$m US$m
Current
– Bank overdrafts 0.3 0.3 0.1 0.1
Current portion of long-term borrowings
– Bank loans 6.9 6.9 25.1 25.8
– Other borrowings 6.2 6.2 0.2 0.2
13.1 13.1 25.3 26.0
Current borrowings 13.4 13.4 25.4 26.1
Long-term borrowings
– Bank loans 660.1 660.1 565.8 565.3
– Other borrowings 2.1 2.1 7.6 7.7
– Tax increment financing (refer note 18) 1.7 1.7 1.7 1.7
Long-term borrowings 663.9 663.9 575.1 574.7
677.3 677.3 600.5 600.8
The fair values are based on the expected future payments discounted at a market interest rate of 4.7% (2006: 4.1%).
The fair values of current and long-term borrowings approximate their carrying amount, as the impact of discounting
is not significant.

17 Borrowings continued
Borrowings are further summarized as follows:
Fixed rate borrowings
Weighted Weighted
average average Floating rate
interest rates period borrowings Total
% Years US$m US$m US$m
2007
Euro 5.8 0.7 14.8 – 14.8
Hong Kong Dollar 3.9 1.2 146.2 203.4 349.6
Swiss Franc 4.4 24.0 2.2 18.6 20.8
United Kingdom Sterling 6.8 6.5 42.4 127.3 169.7
United States Dollar 5.3 2.6 49.7 53.0 102.7
Japanese Yen 1.2 – – 19.7 19.7
255.3 422.0 677.3
2006
Euro 5.8 1.7 14.2 – 14.2
Hong Kong Dollar 4.4 2.2 146.7 181.9 328.6
Swiss Franc 3.7 25.0 2.0 21.0 23.0
United Kingdom Sterling 6.2 – – 111.8 111.8
United States Dollar 5.5 3.6 51.2 53.2 104.4
Japanese Yen 0.8 – – 18.5 18.5
214.1 386.4 600.5
The weighted average interest rates and period are stated after taking into account of hedging transactions
(refer note 28).
The remaining contractual maturities of the borrowings, including the contractual interest payments, are analyzed
as follows:
2007 2006
US$m US$m
Within one year 45.3 54.7
Between one and two years 38.3 207.1
Between two and three years 143.4 31.1
Between three and four years 28.7 382.5
Between four and five years 28.7 2.1
Beyond five years 577.3 15.7
861.7 693.2
Secured 649.5 574.4
Unsecured 27.8 26.1
677.3 600.5
Borrowings of US$649.5 million (2006: US$574.4 million) are secured against the fixed assets of certain subsidiaries.
The book value of these fixed assets as at 31st December 2007 was US$951 million (2006: US$1,024.7 million).
Annual Report 2007 63

Notes to the Financial Statements Continued
18 Tax increment financing
64 Mandarin Oriental International Limited
2007 2006
US$m US$m
Netted off against the net book value of the property (refer note 10) 29.8 30.6
Loan (refer note 17) 1.7 1.7
31.5 32.3
A development agreement was entered into between one of the Group’s subsidiaries and the District of Columbia
(‘District’), pursuant to which the District agreed to provide certain funds to the subsidiary out of the net proceeds
obtained through the issuance and sale of certain tax increment financing bonds (‘TIF Bonds’) for the development
and construction of Mandarin Oriental, Washington D.C.
The District agreed to contribute to the subsidiary US$33 million through the issuance of TIF bonds in addition
to US$1.7 million issued in the form of a loan, bearing simple interest at an annual rate of 6.0%. The US$1.7 million
loan plus all accrued interest will be due on the earlier of 10th April 2017 or the date of the first sale of the hotel.
The receipt of the TIF Bonds has been treated as a government grant and netted off against the net book value in
respect of the property (refer note 10). The loan of US$1.7 million (2006: US$1.7 million) is included in long-term
borrowings (refer note 17).
19 Segment information
Analysis by geographical area
Associates
Capital Segment and joint Segment
expenditure assets ventures liabilities
US$m US$m US$m US$m
2007
Hong Kong and Macau 27.7 488.3 15.8 (48.0 )
Other Asia 6.4 60.4 156.4 (15.5 )
Europe 18.8 590.9 – (27.3 )
The Americas 2.4 183.2 32.4 (17.7 )
Segment 55.3 1,322.8 204.6 (108.5 )
Unallocated – 533.6 – (792.2 )
55.3 1,856.4 204.6 (900.7 )
2006
Hong Kong and Macau 113.9 467.2 15.4 (41.6 )
Other Asia 7.7 59.0 130.6 (18.5 )
Europe 7.6 525.5 – (16.8 )
The Americas 1.1 212.7 44.0 (15.8 )
Segment 130.3 1,264.4 190.0 (92.7 )
Unallocated – 320.5 – (677.8 )
130.3 1,584.9 190.0 (770.5 )
Capital expenditure comprises additions of intangible assets, tangible assets, and land use rights, including those
arising from subsidiary undertakings. Unallocated assets and liabilities comprise other investments, tax assets and
liabilities, cash and cash equivalents and borrowings. Associates and joint ventures include the Group’s share of
attributable net assets.
Analysis by activity
Substantially all of the net assets of the Group are employed in hotel ownership.

20 Share capital
Ordinary shares in millions
2007 2006 2007 2006
US$m US$m
Authorized
Shares of US¢5 each 1,500.0 1,500.0 75.0 75.0
Issued and fully paid
At 1st January 990.8 992.6 49.6 49.7
Repurchase of shares under share
incentive schemes – (1.8 ) – (0.1 )
At 31st December 990.8 990.8 49.6 49.6
Outstanding under share incentive schemes (17.2 ) (22.8 ) (0.9 ) (1.2 )
At 31st December 973.6 968.0 48.7 48.4
21 Share premium
2007 2006
US$m US$m
At 1st January 173.0 174.8
Repurchase of shares under share incentive schemes – (1.8 )
173.0 173.0
Outstanding under share incentive schemes (9.5 ) (12.7 )
At 31st December 163.5 160.3
22 Senior Executive Share Incentive Schemes
The Senior Executive Share Incentive Schemes were set up in order to provide selected executives with options to
purchase ordinary shares in the Company.
The exercise price of the granted options is based on the average market price for the five trading days immediately
preceding the date of grant of the options. Options are vested in tranches over a period of up to five years and are
exercisable for up to ten years following the date of grant. Prior to the adoption of the 2005 Plan on 4th May 2005,
ordinary shares were issued on the date of grant of the options to the Trustee of the Schemes, Mandarin Oriental
Trustees Limited, a wholly-owned subsidiary undertaking, which holds the ordinary shares until the options are
exercised. Under the 2005 Plan, ordinary shares may be issued upon exercise of the options.
The shares issued under the Schemes held on trust by the wholly-owned subsidiary undertaking are, for presentation
purposes, netted off the Company’s share capital in the consolidated balance sheet (refer note 20) and the premium
attached to them is netted off the share premium account (refer note 21).
Annual Report 2007 65

Notes to the Financial Statements Continued
22 Senior Executive Share Incentive Schemes continued
Movements for the year:
66 Mandarin Oriental International Limited
2007 2006
Weighted Weighted
average average
exercise exercise
price Options price Options
US$ in millions US$ in millions
At 1st January 0.72 31.2 0.64 27.7
Granted 1.88 5.6 1.02 8.3
Exercised 0.62 (5.6 ) 0.62 (2.6 )
Repurchased and cancelled 0.99 (0.1 ) 1.05 (2.2 )
At 31st December 0.94 31.1 0.72 31.2
The average share price during the year was US$2.13 (2006: US$1.21) per share.
Outstanding at 31st December:
Ordinary shares in millions
Exercise price
Expiry date US$ 2007 2006
2007 1.2 – 0.2
2008 0.5 – 0.9 2.9 6.5
2009 0.7 – 0.8 1.9 11.1
2010 0.5 – 0.7 4.6 5.6
2011 0.6 1.2 1.2
2012 0.4 1.7 1.7
2013 0.3 – 0.4 1.0 1.0
2014 0.6 0.8 0.8
2015 0.8 – 1.0 3.6 3.1
2016 1.0 – 1.4 7.8 –
2017 1.9 5.6 –
Total outstanding 31.1 31.2
of which exercisable 15.9 20.3
The fair value of options granted during the year, determined using the Trinomial valuation model, was
US$5 million (2006: US$4 million). The significant inputs into the model, based on the weighted average number of
options issued, were share price at the grant date of US$1.98 (2006: US$1.05), exercise price shown
above, expected volatility based on the last three years of 33% (2006: 34%), dividend yield of 1.4% (2006: 1.3%),
option life disclosed above, and annual risk-free interest rate of 4.5% (2006: 4.7%).

23 Revenue and other reserves
Revenue Capital Hedging Exchange
reserves reserves reserves reserves Total
US$m US$m US$m US$m US$m
2007
At 1st January 364.2 480.3 1.7 (54.2 ) 792.0
Revaluation of properties
– net revaluation surplus – 70.3 – – 70.3
– deferred tax – (26.1 ) – – (26.1 )
Revaluation of other investments
– fair value gain 0.1 – – – 0.1
Defined benefit pension plans
– actuarial gain 7.6 – – – 7.6
– deferred tax (1.4 ) – – – (1.4 )
Net exchange translation differences
– amount arising in year – – – 37.4 37.4
– transfer to profit and loss (note 2) – – – (8.3 ) (8.3 )
Fair value loss on cash flow hedges – – (5.2 ) – (5.2 )
Deferred tax on fair value loss – – 1.5 – 1.5
Share-based payments – 2.7 – – 2.7
Profit attributable to shareholders 108.2 – – – 108.2
Dividends (refer note 26) (38.7 ) – – – (38.7 )
At 31st December 2007 440.0 527.2 (2.0 ) (25.1 ) 940.1
Of which:
– Company 91.9 10.3 – – 102.2
– Associates and joint ventures (10.1 ) 114.4 – (44.7 ) 59.6
Annual Report 2007 67

Notes to the Financial Statements Continued
23 Revenue and other reserves continued
68 Mandarin Oriental International Limited
Revenue Capital Hedging Exchange
reserves reserves reserves reserves Total
US$m US$m US$m US$m US$m
2006
At 1st January 294.1 427.8 5.5 (99.4 ) 628.0
Revaluation of properties
– net revaluation surplus – 74.7 – – 74.7
– deferred tax – (23.9 ) – – (23.9 )
Defined benefit pension plans
– actuarial gain 5.6 – – – 5.6
– deferred tax (1.0 ) – – – (1.0 )
Net exchange translation differences – – – 44.8 44.8
Fair value loss on cash flow hedges – – (2.8 ) – (2.8 )
Deferred tax on fair value gain – – (0.6 ) – (0.6 )
Share-based payments – 1.7 – – 1.7
Profit attributable to shareholders 80.0 – – – 80.0
Transfer between reserves – – (0.4 ) 0.4 –
Dividends (refer note 26) (14.5 ) – – – (14.5 )
At 31st December 2006 364.2 480.3 1.7 (54.2 ) 792.0
Of which:
– Company 91.7 7.6 – – 99.3
– Associates and joint ventures (20.2 ) 112.8 – (62.1 ) 30.5
Capital reserves include property revaluation reserves of US$262.8 million net of attributable deferred tax of
US$93.7 million (2006: US$218.6 million net of attributable deferred tax of US$67.6 million) which are not
distributable in certain territories in which the Group operates.

24 Non-current asset classified as held for sale
An analysis of the non-current asset held for sale is as follows:
2007 2006
US$m US$m
Associates and joint ventures (refer note 11) – 13.7
Loan receivable (refer note 12) – 31.2
Current assets – 9.0
Total assets – 53.9
The Group’s 25% interest in Mandarin Oriental, New York was classified as held for sale as at 31st December 2006.
The sale was completed on 1st March 2007 (refer note 6).
25 Minority interests
At 1st January 3.7 3.7
Net exchange translation differences 0.9 0.3
Revaluation of properties
– net revaluation surplus/(deficit) 8.1 (0.6 )
– deferred tax (3.7 ) 0.2
Fair value loss on financial instruments (0.3 ) (0.1 )
Deferred tax on fair value loss 0.1 –
Attributable profit/(loss) (0.8 ) 0.2
At 31st December 8.0 3.7
26 Dividends
Final dividend in respect of 2006 of US¢3.00 (2005: US¢1.50) per share 29.0 14.5
Interim dividend in respect of 2007 of US¢1.00 (2006: nil) per share 9.7 –
38.7 14.5
A final dividend in respect of 2007 of US¢5.00 (2006: US¢3.00) per share amounting to a total of US$48.5 million
(2006: US$29 million) is proposed by the Board. The dividend proposed will not be accounted for until it has been
approved at the Annual General Meeting. The amount will be accounted for as an appropriation of revenue reserves
in the year ending 31st December 2008.
Annual Report 2007 69

Notes to the Financial Statements Continued
27 Notes to consolidated cash flow statement
a) Non-cash items
70 Mandarin Oriental International Limited
2007 2006
US$m US$m
Gain on disposal (refer note 5) – (76.8 )
Pension expenses 0.3 1.0
Other (4.2 ) 1.1
b) Movements in working capital
(3.9 ) (74.7 )
Increase in stocks (0.4 ) (1.2 )
Increase/(decrease) in debtors and prepayments 0.5 (13.8 )
Increase in creditors and accruals 5.2 13.6
c) Proceeds on disposal of The Mark
5.3 (1.4 )
Net assets disposed of (refer note 24) – 66.3
Direct transaction costs – 6.9
Gain on disposal (refer note 5) – 76.8
Sales proceeds – 150.0
Tax and other expenses paid – (51.5 )
Net cash flow – 98.5
d) Proceeds on disposal related to an associate
Net assets disposed of (refer note 11) 13.7 –
Gain on disposal (refer note 6) 25.0 –
38.7 –
Repayment of mezzanine loan and interest 41.0 –
Tax (9.0 ) –
Net cash flow 70.7 –
e) Capital distribution from associates
Concurrent with the partial sale of the Group’s interest in Mandarin Oriental, New York, the hotel increased its
external borrowings resulting in a return of capital of approximately US$13.2 million on the Group’s continuing
25% interest in the hotel. The Group also received repayment of US$1.2 million from its interest in shareholder
loans previously provided to Mandarin Oriental, Miami.
f) Analysis of balances of cash and cash equivalents
Cash at bank 492.4 286.7
Bank overdrafts (0.3 ) (0.1 )
492.1 286.6
The weighted average effective interest rate on short-term bank deposits included in cash at bank was 4.8%
(2006: 4.4%).

28 Derivative financial instruments
The fair values of derivative financial instruments at 31st December are as follows:
2007 2006
Positive Negative Positive Negative
fair fair fair fair
value value value value
US$m US$m US$m US$m
Designated as cash flow hedges
– interest rate swaps and caps 0.2 2.9 2.9 0.2
At 31st December 0.2 2.9 2.9 0.2
The remaining contractual maturities of derivative financial instruments, based on their undiscounted cash outflows,
are analyzed as follows:
Within Between Between Over
one one and two and five
year two years five years years
US$m US$m US$m US$m
2007
Net settled
– interest rate swaps 0.4 1.1 1.5 0.7
2006
Net settled
– interest rate swaps – – 0.2 –
The notional principal amounts of the outstanding derivative financial instruments at 31st December 2007 were
US$312.9 million (2006: US$262.3 million).
At 31st December 2007, the fixed interest rates relating to interest rate swaps and caps ranged from 1.5% to 7.0%
(2006: 1.5% to 6.0%).
The fair values of interest rate swaps are based on the estimated cash flows discounted at market rates ranging from
3.7% to 6.4% (2006: 4.0% to 5.4%) per annum.
29 Financial guarantee
2007 2006
US$m US$m
Guarantees in respect of facilities made available to associates and joint ventures 12.5 70.5
Guarantees in respect of facilities made available to associates and joint ventures are stated at their respective
contracted amounts. The Directors are of the opinion that it is not probable that such guarantees will be called upon.
Annual Report 2007 71

Notes to the Financial Statements Continued
30 Commitments
72 Mandarin Oriental International Limited
2007 2006
US$m US$m
Capital commitments:
Authorized not contracted 48.0 15.1
Contracted not provided 14.6 22.6
62.6 37.7
Operating lease commitments:
The future aggregate minimum lease payments under non-cancellable operating leases
are as follows:
Within one year 6.3 5.5
Between two and five years 24.8 22.9
Over five years 133.8 132.6
164.9 161.0
Total future sublease payments receivable relating to the above operating leases amounted to US$0.1 million
(2006: US$0.2 million).
In addition, the Group has operating lease commitments with rentals determined in relation to sales. It is not possible
to quantify accurately future rentals payable under such leases.
31 Related party transactions
The parent company of the Group is Jardine Strategic Holdings Limited and the ultimate holding company of the
Group is Jardine Matheson Holdings Limited (‘JMH’). Both companies are incorporated in Bermuda.
In the normal course of business, the Group undertakes a variety of transactions with its associates and with
JMH and its subsidiaries and associates. In addition, the Group paid a management fee of US$0.5 million
(2006: US$0.4 million) to Jardine Matheson Limited (‘JML’), a subsidiary of JMH, being a fee of 0.5% of the
Group’s net profit in consideration for certain management consultancy services provided by JML. The Group has
no outstanding balance with JML as at 31st December 2007 (2006: nil).
During 2007, the Group managed seven associate and joint venture hotels and received management fees of
US$15.7 million (2006: US$16.8 million) based on long-term management agreements on normal commercial
terms. The outstanding balances with associates and joint ventures are set out in debtors and prepayments in note 15.
The Group engages Gammon Construction Limited (‘Gammon’), a joint venture of JMH, as contractor for certain of
the Group hotel renovation projects. Management fees paid by the Group to Gammon in 2007 were US$0.4 million
(2006: US$4.1 million). The Group has no outstanding balance with Gammon as at 31st December 2007 (2006: nil).
The Group uses Jardine Lloyd Thompson (‘JLT’), an associate of JMH, to place certain of its insurance.
Brokerage fees and commissions, net of rebates, paid by the Group in 2007 to JLT amounted to US$0.5 million
(2006: US$0.6 million). The Group has no outstanding balance with JLT as at 31st December 2007 (2006: nil).

31 Related party transactions continued
During 2006, the Group rented an office space from Hongkong Land (‘HKL’), an associate of JMH. Gross rental
paid by the Group to HKL in 2006 was US$0.3 million. The Group also provides hotel management services to
HKL and received management fees of US$0.5 million in 2007 (2006: US$0.4 million) based on long-term
management agreements on normal commercial terms. The Group has no outstanding balance with HKL as
at 31st December 2007 (2006: US$0.1 million).
Details of Directors’ emoluments (being the key management personnel compensation) are shown on page 79
under the heading of ‘Directors’ appointment, retirement, remuneration and service contracts’.
32 Summarized balance sheet of the Company
Included below is certain summarized balance sheet information of the Company disclosed in accordance with
Bermuda Law:
2007 2006
US$m US$m
Subsidiaries at cost 325.6 322.7
Net current liabilities (0.8 ) (0.8 )
Net operating assets 324.8 321.9
Share capital (refer note 20) 49.6 49.6
Share premium (refer note 21) 173.0 173.0
Revenue reserves (refer note 23) 91.9 91.7
Other reserves (refer note 23) 10.3 7.6
Shareholders’ funds 324.8 321.9
Annual Report 2007 73

Principal Subsidiaries, Associates, Joint Ventures
and Managed Hotels
as at 31st December 2007
Principal country Company name Main activities
Subsidiaries
Hong Kong Mandarin Oriental Hotel Group International Limited Management
Hong Kong Mandarin Oriental Hotel Group Limited Management
Hong Kong Mandarin Oriental, Hong Kong Limited Owner: Mandarin Oriental, Hong Kong
Excelsior Hotel (BVI) Limited Owner: The Excelsior, Hong Kong
United Kingdom Mandarin Oriental Hyde Park Limited Owner: Mandarin Oriental Hyde Park, London
Germany Dinavest International Holdings B.V. Owner: Mandarin Oriental, Munich
Philippines Manila Mandarin Hotel Incorporated Owner: Mandarin Oriental, Manila
Switzerland Société Immobilère de Mandarin Oriental Hôtel du Rhône SA
Société pour l’Exploitation de Mandarin Oriental Hôtel du Rhône
Owner: Mandarin Oriental Hotel du Rhône, Geneva
United States Portals Hotel Site LLC Owner: Mandarin Oriental, Washington D.C.
Indonesia P.T. Jaya Mandarin Agung Owner: Mandarin Oriental, Jakarta
Japan Mandarin Oriental Tokyo KK Owner: Mandarin Oriental, Tokyo
Associates
Singapore Marina Bay Hotel Private Limited Owner: Mandarin Oriental, Singapore
Thailand The Oriental Hotel (Thailand) PCL Owner: The Oriental, Bangkok
Malaysia Asas Klasik Sdn Bhd Owner: Mandarin Oriental, Kuala Lumpur
United States Istithmar Columbus Centre LLC Owner: Mandarin Oriental, New York
United States Swire Brickell Key Hotel Limited Owner: Mandarin Oriental, Miami
Thailand Chaophaya Development Corporation Limited Owner: River City Shopping Complex
Joint Ventures
Macau Excelsior Hoteis E Investimentos Limitada Owner: Mandarin Oriental, Macau
Managed Hotels
Hong Kong The Landmark Mandarin Oriental, Hong Kong
United States Mandarin Oriental, San Francisco
Bermuda Elbow Beach, Bermuda
Thailand Mandarin Oriental Dhara Dhevi, Chiang Mai
Czech Republic Mandarin Oriental, Prague
Note
1. Preference shares
74 Mandarin Oriental International Limited

Attributable interest %
2007 2006 Issued share capital Hotel profile
100 100 US$12,000 –
100 100 HK$60,000,000 –
100 100 HK$33,000,000 502 rooms. Lease expiry 2895
100 100 US$100 884 rooms. Lease expiry 2842
100 100 GBP 4,493,484
GBP 1,578,791 (note 1)
198 rooms. Freehold
100 100 Euro 3,632,000 73 rooms. Freehold
96.2 96.2 Peso 288,918,400 443 rooms. Lease expiry 2026
85.3 85.3 CHF 6,800,000 190 rooms. Lease expiry 2040
100 100 CHF 10,800,000 –
80 80 – 400 rooms. Freehold
88.3 88.3 Rup 8,196,250,000 404 rooms. Lease expiry 2023
100 100 Yen 10,000,000 179 rooms. Lease expiry 2035
50 50 S$141,500,000 527 rooms. Lease expiry 2079
44.9 44.9 Baht 160,000,000 393 rooms. Various freehold/leasehold
25 25 RM 130,000,000 632 rooms. Freehold
25 50 – 248 rooms. Freehold
25 25 – 327 rooms. Freehold
49 49 Baht 120,000,000 –
50 50 Ptc 20,000,000 416 rooms. Lease expiry 2032
– – – 113 rooms
– – – 158 rooms
– – – 235 rooms
– – – 123 rooms
– – – 99 rooms
Annual Report 2007 75

Independent Auditor’s Report
To the members of Mandarin Oriental International Limited
We have audited the accompanying consolidated financial statements of Mandarin Oriental International Limited and
its subsidiaries (the ‘Group’) which comprise the consolidated balance sheet as of 31st December 2007 and the
consolidated profit and loss account, consolidated statement of recognized income and expense and consolidated cash
flow statement for the year then ended and a summary of significant accounting policies and other explanatory notes.
Directors’ Responsibility for the Financial Statements
The Company’s Directors are responsible for the preparation and fair presentation of these consolidated financial
statements in accordance with International Financial Reporting Standards and with the requirements of Section 90
of the Bermuda Companies Act. This responsibility includes: designing, implementing and maintaining internal
control relevant to the preparation and fair presentation of financial statements that are free from material
misstatement, whether due to fraud or error; selecting and applying appropriate accounting policies; and making
accounting estimates that are reasonable in the circumstances.
Auditor’s Responsibility
Our responsibility is to express an opinion on these consolidated financial statements based on our audit. We
conducted our audit in accordance with International Standards on Auditing. Those Standards require that we
comply with ethical requirements and plan and perform the audit to obtain reasonable assurance whether the financial
statements are free from material misstatement.
An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the financial
statements. The procedures selected depend on the auditor’s judgment, including the assessment of the risks of
material misstatement of the financial statements, whether due to fraud or error. In making those risk assessments, the
auditor considers internal control relevant to the entity’s preparation and fair presentation of the financial statements
in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing
an opinion on the effectiveness of the entity’s internal control. An audit also includes evaluating the appropriateness
of accounting policies used and the reasonableness of accounting estimates made by management, as well as evaluating
the overall presentation of the financial statements.
We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit
opinion.
Opinion
In our opinion, the accompanying consolidated financial statements present fairly, in all material respects, the
financial position of the Group as of 31st December 2007, and of its financial performance and its cash flows for the
year then ended in accordance with International Financial Reporting Standards and with the requirements of the
Bermuda Companies Act.
Other Matters
This report, including the opinion, has been prepared for and only for the Company’s members as a body in
accordance with Section 90 of the Bermuda Companies Act and for no other purpose. We do not, in giving this
opinion, accept or assume responsibility for any other purpose or to any other person to whom this report is shown or
into whose hands it may come save where expressly agreed by our prior consent in writing.
PricewaterhouseCoopers LLP
London
United Kingdom
6th March 2008
76 Mandarin Oriental International Limited

Five Year Summary
Consolidated Profit and Loss Account
2003 2004 2005 2006 2007
US$m US$m US$m US$m US$m
Revenue 218.1 336.8 399.2 404.6 529.5
Operating profit 29.8 43.4 60.4 121.9 107.7
Net financing charges (23.8 ) (27.5 ) (22.4 ) (15.2 ) (16.4 )
Share of results of associates and joint ventures (0.9 ) 12.6 8.7 13.0 22.9
Gains on disposal of associates – – 52.3 – 16.0
Profit before tax 5.1 28.5 99.0 119.7 130.2
Tax (8.0 ) (4.8 ) (24.8 ) (39.5 ) (22.8 )
Profit/(Loss) for the year (2.9 ) 23.7 74.2 80.2 107.4
Profit/(Loss) attributable to shareholders (1.8 ) 28.5 77.2 80.0 108.2
Profit/(Loss) attributable to minority interests (1.1 ) (4.8 ) (3.0 ) 0.2 (0.8 )
(2.9 ) 23.7 74.2 80.2 107.4
Earnings per share (US¢) (0.21 ) 3.35 8.14 8.28 11.16
Dividends per share (US¢) – 1.00 1.50 3.00 6.00
Consolidated Balance Sheet
Intangible assets 219.7 219.4 215.5 216.0 216.2
Tangible assets 687.1 752.1 684.0 882.5 995.0
Associates and joint ventures 243.3 258.6 174.0 190.0 204.6
Other investments 18.2 6.4 5.1 6.4 10.3
Loan receivables – – 43.0 12.0 3.4
Pension assets 19.2 22.9 22.8 27.1 34.0
Deferred tax assets 4.9 7.8 9.9 27.4 27.5
Other non-current assets – – 5.5 2.9 0.2
Net current assets/(liabilities) 35.8 (32.3 ) 202.1 289.8 443.7
Long-term borrowings (584.9 ) (497.1 ) (471.6 ) (575.1 ) (663.9 )
Deferred tax liabilities (26.0 ) (38.2 ) (49.8 ) (72.9 ) (107.7 )
Pension liabilities (1.7 ) (1.7 ) (1.7 ) (1.5 ) (0.1 )
Other non-current liabilities (4.1 ) (6.0 ) – (0.2 ) (2.9 )
Net operating assets 611.5 691.9 838.8 1,004.4 1,160.3
Share capital 42.6 42.6 48.3 48.4 48.7
Share premium 88.7 89.0 158.8 160.3 163.5
Revenue and other reserves 469.0 552.1 628.0 792.0 940.1
Shareholders’ funds 600.3 683.7 835.1 1,000.7 1,152.3
Minority interests 11.2 8.2 3.7 3.7 8.0
Capital employed 611.5 691.9 838.8 1,004.4 1,160.3
Net asset value per share (US$) 0.70 0.80 0.87 1.03 1.18
Consolidated Cash Flow Statement
Cash flows from operating activities 28.3 47.1 72.6 62.4 129.5
Cash flows from investing activities (84.7 ) (28.4 ) 43.3 (38.0 ) 38.4
Net cash flow before financing activities (56.4 ) 18.7 115.9 24.4 167.9
Cash flow per share from operating activities (US¢) 3.32 5.53 7.65 6.46 13.35
Annual Report 2007 77

Corporate Governance
The Group’s corporate governance relies on a combination of shareholder, board and management supervision and
strict compliance, internal audit and risk control procedures, within the context of the various international regulatory
regimes to which the Group is subject.
Mandarin Oriental International Limited is incorporated in Bermuda. The Company was established as an
Asian-based hotel group and has since extended its operations to key locations around the world. The Company
has its primary share listing on the London Stock Exchange and secondary listings in Bermuda and Singapore. The
primary corporate governance regime applicable to the Company arises under the laws of Bermuda, including under
certain specific statutory provisions that apply to the Company alone. The Company has fully complied with that
governance regime. The Company is not subject to the Combined Code (the ‘Code’) that applies to United Kingdom
incorporated companies listed in London, but this Report outlines the significant ways in which its corporate
governance practices differ from those set out in the Code.
The Management of the Group
The Company has its dedicated executive management under the Group Chief Executive. The Memorandum of
Association of the Company, however, provides for the chairman of Jardine Matheson Holdings Limited (‘Jardine
Matheson’) to be, or to appoint, the Managing Director of the Company. The managing director of Jardine Matheson
has been so appointed. Reflecting this, and the 74% interest of the Jardine Matheson group in the Company’s share
capital, the Group Chief Executive and the Managing Director meet regularly. Similarly, the board of the Hong
Kong-based Group management company, Mandarin Oriental Hotel Group International Limited (‘MOHG’),
and its finance committee are chaired by the Managing Director and include Group executives and the group
finance director, the group strategy director and the group general counsel of Jardine Matheson.
The Board
The Company currently has a Board of 16 directors: the Group Chief Executive and Chief Financial Officer; six
executives of Jardine Matheson; and eight non-executive Directors. Their names and brief biographies appear on
pages 26 and 27 of this Report. The Chairman has been appointed in accordance with the provisions of the Bye-laws
of the Company, which provide that the chairman of Jardine Matheson, or any Director nominated by him, shall be
the Chairman of the Company. The composition and operation of the Board reflect the approach to management
described in this Report. The Board regards relevant business experience and relationships as more valuable attributes
of its non-executive Directors than formal independence criteria. The Company does not have nomination or
remuneration committees or a formal Board evaluation process. Decisions on nomination and remuneration result
from consultations between the Chairman and the Managing Director and other Directors as they consider
appropriate. The four executives of Jardine Matheson on the board of MOHG, being A J L Nightingale, Jonathan
Gould, Mark Greenberg and James Riley, also form the MOHG audit committee that has responsibility for
the Group. The Board has not designated a ‘senior independent director’ as set out in the Code.
Among the matters which the Board of the Company decides are the Group’s business strategy, its annual budget,
dividends and major corporate activities. Responsibility for implementing the Group’s strategy is delegated to the
Company’s executive management, with decision-making authority within designated financial parameters delegated
to the MOHG finance committee. In addition, certain Directors of the Company based outside Asia make regular
visits to Asia and Bermuda, where they participate in five annual strategic reviews, four of which normally precede the
full Board meetings. These Directors’ knowledge of the region and the Group’s affairs reinforces the process by which
business is reviewed by the Board.
78 Mandarin Oriental International Limited

The Board continued
The Board is scheduled to hold four meetings in 2008, and ad hoc procedures are adopted to deal with urgent matters.
Two meetings each year are held in Bermuda and two in Asia. The Board receives high quality, up to date information
for each of its meetings, which has previously been considered and approved at meetings of the board of MOHG. This
information is also the subject of a strategy review in a cycle of meetings (in Bermuda or Asia, as appropriate) prior to
consideration by the Board itself.
Directors’ appointment, retirement, remuneration and service contracts
Candidates for appointment as executive Directors of the Company, or as executive directors of MOHG or senior
executives elsewhere in the Group may be sourced internally, from the Jardine Matheson group or externally using
the services of specialist executive search firms. The aim is to appoint individuals of the highest calibre in their area
of expertise.
Each new Director is appointed by the Board and in accordance with Bye-law 92 of the Company’s Bye-laws, each
new Director is subject to retirement at the first Annual General Meeting after appointment. Thereafter, the Director
will be subject to retirement by rotation pursuant to Bye-law 85 whereby one-third of the Directors retire at the
Annual General Meeting each year. These provisions apply to both executive and non-executive Directors, but the
requirement to retire by rotation pursuant to Bye-law 85 does not extend to the Chairman or Managing Director.
In accordance with Bye-law 85, Dr Richard Lee, Robert Léon, James Watkins and John R Witt retire by rotation at
the Annual General Meeting and, being eligible, offer themselves for re-election. John R Witt has a service contract
with Mandarin Oriental Hotel Group Limited that provides for termination with a notice period of six months. None
of the other Directors proposed for re-election has a service contract with the Company or its subsidiaries.
The Company’s policy is to offer competitive remuneration packages to its senior executives. It is recognized that,
due to the nature of the Group and its diverse geographic base, a number of its senior executives, including the
Group Chief Executive and Chief Financial Officer, are required to be offered international terms. The nature of
the remuneration packages is designed to reflect this, for example by the provision of accommodation.
Non-executive Directors’ fees are decided upon by shareholders in general meeting as provided for by the Company’s
Bye-laws. A motion to increase the Directors’ fees to US$30,000 each per annum and the fees for the Chairman and
Managing Director to US$40,000 each per annum, save that salaried executives shall not be eligible for such fees, with
effect from 1st January 2008 will be proposed at the forthcoming Annual General Meeting.
For the year ended 31st December 2007, the Directors received from the Group US$4.82 million
(2006: US$4.24 million) in employee benefits, being US$4.77 million (2006: US$4.19 million) in short-term
employee benefits including salary, bonus, accommodation and deemed benefits in kind, US$0.05 million
(2006: US$0.05 million) in post-employment benefits and US$1.16 million (2006: US$0.82 million) in share-based
payments. The information set out in this paragraph forms part of the audited financial statements.
Senior executive share incentive schemes have also been established to provide longer-term incentives for executive
Directors and senior managers. Share options are granted by the scheme trustee after consultation between the
Chairman, the Managing Director and the Group Chief Executive and other Directors as they consider appropriate.
Share options are granted at the then prevailing market prices and the scheme rules now provide that they normally
vest after the third anniversary of the date of grant. Grants may be made in a number of instalments. Share options are
not granted to non-executive Directors.
Annual Report 2007 79

Corporate Governance Continued
Directors’ appointment, retirement, remuneration and service contracts continued
The Company purchases insurance to cover its Directors against their costs in defending themselves in civil
proceedings taken against them in that capacity and in respect of damages resulting from the unsuccessful defence of
any proceedings. To the extent permitted by law, the Company also indemnifies its Directors. Neither the insurance
nor the indemnity provides cover where the Director has acted fraudulently or dishonestly.
Directors’ responsibilities in respect of the financial statements
The Directors are required under the Bermuda Companies Act 1981 to prepare financial statements for each financial
year and to present them annually to the Company’s shareholders at the Annual General Meeting. The financial
statements should present fairly in accordance with International Financial Reporting Standards (‘IFRS’) the financial
position of the Group at the end of the year and the results of its operations and its cash flows for the year then ended.
The Directors consider that applicable accounting policies under IFRS, applied on a consistent basis and supported by
prudent and reasonable judgements and estimates, have been followed in preparing the financial statements.
Code of Conduct
The Group conducts business in a professional, ethical and even-handed manner. Its ethical standards are clearly set
out in the Jardine Matheson group Code of Conduct, an important set of guidelines to which every employee must
adhere. The code requires that all Group companies comply with all laws of general application, all rules and
regulations that are industry specific and proper standards of business conduct. The code prohibits the giving or
receiving of illicit payments, and requires all employees to be treated fairly, impartially and with respect. It also
requires that all managers must be fully aware of their obligations under the Code of Conduct and establish
procedures to ensure compliance at all levels within their organizations. The Group has in place procedures by which
employees can raise, in confidence, matters of serious concern in areas such as financial reporting or compliance.
Internal control
The Board has overall responsibility for the Group’s system of internal control. The system of internal control is
designed to manage, rather than eliminate, business risk; to help safeguard the Group’s assets against fraud and other
irregularities; and to give reasonable, but not absolute, assurance against material financial misstatement or loss.
The Board has delegated to the audit committee of MOHG responsibility for reviewing the operation and
effectiveness of the Group’s system of internal control and the procedures by which this is monitored. The audit
committee considers the system and procedures on a regular basis, and reports to the Board semi-annually. The Group
Chief Executive and Chief Financial Officer of MOHG, together with representatives of the internal and external
auditors, attend the meetings of the audit committee by invitation.
Executive management is responsible for the implementation of the system of internal control throughout the Group
and the internal audit function monitors the effectiveness of the system. The internal audit function is outside the
operating businesses and reports its findings, and recommendations for any corrective action required, to the audit
committee of MOHG.
The Group has in place an organizational structure with defined lines of responsibility and delegation of authority.
There are established policies and procedures for financial planning and budgeting; for information and reporting
systems; for assessment of risk; and for monitoring the Group’s operations and performance. The information systems
in place are designed to ensure that the financial information reported is reliable and up to date.
80 Mandarin Oriental International Limited

Internal control continued
The Company’s policy on commercial conduct is also an important part of the Group’s internal control process,
particularly in the area of compliance. The policy, as set out in the Code of Conduct, is reinforced and monitored by
an annual compliance certification process.
The audit committee of MOHG has also been given the responsibility to oversee the effectiveness of the formal
procedures for employees to raise any matters of serious concern, and is required to review any reports made under
those procedures that are referred to it by the internal audit function.
Prior to completion and announcement of the half-year and year-end results, a review of the financial information and
of any issues raised in connection with the preparation of the results is undertaken by the audit committee of MOHG
with the executive management and a report is received from the external auditors. The external auditors also have
access to the full Board, in addition to the Group Chief Executive, Chief Financial Officer and other senior executives.
The audit committee of MOHG keeps under review the nature, scope and results of the external audit and the audits
conducted by the internal audit department. The audit committee of MOHG also keeps under review the
independence and objectivity of the external auditors.
Directors’ share interests
The Directors of the Company in office on 1st April 2008 had interests (within the meaning of the Disclosure and
Transparency Rules (‘DTRs’) of the Financial Services Authority (the ‘FSA’) of the United Kingdom) set out below in
the ordinary share capital of the Company. These interests included those notified to the Company in respect of the
Directors’ connected persons (as that term is used in the DTRs in relation to companies incorporated outside the
United Kingdom).
Simon Keswick 19,858
Edouard Ettedgui 6,250,000
R C Kwok 6,711
Sydney S W Leong 467,577
John R Witt 1,700,000
In addition, Edouard Ettedgui and John R Witt held options in respect of 8,400,000 and 2,950,000 ordinary shares,
respectively, issued pursuant to the Company’s Senior Executive Share Incentive Schemes.
Substantial shareholders
As a non-UK issuer, the Company is subject to the DTRs pursuant to which a person must notify the Company of the
percentage of voting rights attaching to the share capital of the Company that he holds in certain circumstances. The
obligation to notify arises if that person acquires or disposes of shares in the Company which results in the percentage
of voting rights which he holds reaching, exceeding or falling below 5%, 10%, 15%, 20%, 25%, 30%, 50% and 75%.
The Company has been informed of the holding of voting rights of 5% or more attaching to the Company’s issued
ordinary share capital by Jardine Strategic and its subsidiary undertakings, which are directly and indirectly interested
in 728,990,281 ordinary shares carrying 73.58% of the voting rights. By virtue of its interest in Jardine Strategic,
Jardine Matheson is also interested in the same ordinary shares. Apart from this shareholding, the Company is not
aware of any holders of voting rights of 5% or more attaching to the issued ordinary share capital of the Company as
at 1st April 2008.
There were no contracts of significance with corporate substantial shareholders during the year under review.
Annual Report 2007 81

Corporate Governance Continued
Relations with shareholders
The Company maintains a dialogue with major shareholders and holds meetings following the announcement of the
annual and interim results with institutional shareholders. A corporate website is maintained containing a wide range
of information of interest to investors at www.mandarinoriental.com.
The 2008 Annual General Meeting will be held on 7th May 2008. The full text of the resolutions and explanatory
notes in respect of the meeting are contained in the Notice of Meeting which accompanies this Report.
Securities purchase arrangements
At the Annual General Meeting held on 9th May 2007, shareholders renewed the approval of a general mandate
authorizing the Directors to effect purchases by the Company or its subsidiaries of the Company’s own ordinary
shares of less than 15% in aggregate of its issued share capital.
Arrangements under which shareholders have agreed to waive dividends
Mandarin Oriental Trustees Limited has waived the interim dividend and has undertaken to waive the recommended
final dividend for 2007 in respect of the ordinary shares in which it is interested as trustee of the Company’s Senior
Executive Share Incentive Schemes.
Related party transactions
Details of transactions with related parties entered into by the Company during the course of the year are included in
note 31 to the financial statements on pages 72 and 73. There were no transactions entered into by the Company
during the course of the year to which the related party transaction rules of the FSA in the United Kingdom apply.
82 Mandarin Oriental International Limited

Shareholder Information
Financial calendar
2007 full-year results announced ..................................................................................................... 6th March 2008
Share registers closed ......................................................................................................... 24th to 28th March 2008
Annual General Meeting to be held .................................................................................................... 7th May 2008
2007 final dividend payable .............................................................................................................. 14th May 2008
2008 half-year results to be announced .............................................................................................. 31st July 2008 *
Share registers to be closed ............................................................................................. 25th to 29th August 2008 *
2008 interim dividend payable .................................................................................................. 15th October 2008 *
*Subject to change
Dividends
Shareholders will receive their dividends in United States Dollars, unless they are registered on the Jersey branch
register where they will have the option to elect for sterling. These shareholders may make new currency elections
for the 2007 final dividend by notifying the United Kingdom transfer agent in writing by 25th April 2008. The
sterling equivalent of dividends declared in United States Dollars will be calculated by reference to a rate prevailing
on 30th April 2008. Shareholders holding their shares through The Central Depository (Pte) Limited (‘CDP’) in
Singapore will receive United States Dollars unless they elect, through CDP, to receive Singapore Dollars.
Registrars and transfer agent
Shareholders should address all correspondence with regard to their shareholdings or dividends to the appropriate
registrar or transfer agent.
Principal Registrar
Jardine Matheson International Services Limited, PO Box HM 1068, Hamilton HM EX, Bermuda
Jersey Branch Registrar
Capita Registrars (Jersey) Limited (formerly Capita IRG (Offshore) Limited), PO Box 532, St Helier,
Jersey JE4 5UW, Channel Islands
Singapore Branch Registrar
M & C Services Private Limited, 138 Robinson Road #17– 00, The Corporate Office, Singapore 068906
United Kingdom Transfer Agent
Capita Registrars, The Registry, 34 Beckenham Road, Beckenham, Kent BR3 4TU, England
Press releases and other financial information on the Company can be accessed through the Internet at
‘www.mandarinoriental.com’.
Annual Report 2007 83

Mandarin Oriental Hotel Group Contact Addresses
Hong Kong Corporate Office
281 Gloucester Road, Causeway Bay, Hong Kong
Telephone +852 2895 9288
Facsimile +852 2837 3500
www.mandarinoriental.com
Asia-Pacific
The Oriental, Bangkok
48 Oriental Avenue, Bangkok 10500, Thailand
Telephone +66(2) 659 9000
Facsimile +66(2) 659 0000
Email: orbkk-reservations@mohg.com
Mandarin Oriental Dhara Dhevi, Chiang Mai
51/4 Chiang Mai-Sankampaeng Road
Moo 1 T. Tasala A. Muang, Chiang Mai 50000, Thailand
Telephone +66(53) 888 888
Facsimile +66(53) 888 999
Email: mocnx-reservations@mohg.com
Mandarin Oriental, Hong Kong
5 Connaught Road, Central, Hong Kong
Telephone +852 2522 0111
Facsimile +852 2810 6190
Email: mohkg-reservations@mohg.com
The Landmark Mandarin Oriental, Hong Kong
15 Queen’s Road Central, The Landmark
Central, Hong Kong
Telephone +852 2132 0188
Facsimile +852 2132 0199
Email: lmhkg-reservations@mohg.com
Mandarin Oriental, Jakarta
Jalan M H Thamrin, PO Box 3392
Jakarta 10310, Indonesia
Telephone +62(21) 3983 8888
Facsimile +62(21) 3983 8889
Email: mojkt-reservations@mohg.com
Mandarin Oriental, Kuala Lumpur
Kuala Lumpur City Centre
50088 Kuala Lumpur, Malaysia
Telephone +60(3) 2380 8888
Facsimile +60(3) 2380 8833
Email: mokul-reservations@mohg.com
84 Mandarin Oriental International Limited
Mandarin Oriental, Macau
956-1110 Avenida da Amizade PO Box 3016, Macau
Telephone +853 2856 7888
Facsimile +853 2859 4589
Email: momfm-reservations@mohg.com
Mandarin Oriental, Manila
Makati Avenue, Makati City 1226
Metro Manila, Philippines
Telephone +63(2) 750 8888
Facsimile +63(2) 815 0555
Email: momnl-reservations@mohg.com
Mandarin Oriental, Singapore
5 Raffles Avenue, Marina Square Singapore 039797
Telephone +65 6338 0066
Facsimile +65 6339 9537
Email: morsin-reservations@mohg.com
Mandarin Oriental, Tokyo
2-1-1 Nihonbashi Muromachi, Chuo-ku
Tokyo 103-8328, Japan
Telephone +81 3 3270 8800
Facsimile +81 3 3270 8828
Email: motyo-reservations@mohg.com
The Excelsior, Hong Kong
281 Gloucester Road, Causeway Bay, Hong Kong
Telephone +852 2894 8888
Facsimile +852 2895 6459
Email: exhkg-reservations@mohg.com
Mandarin Oriental, Beijing (2008)
No.32 East Dong San Huan Road
Chaoyang District, Beijing, China
Telephone +86(10) 5906 1888
Facsimile +86(10) 5906 1800
Mandarin Oriental, Sanya (2008)
12 Yuhai Road, Sanya City 572000
Hainan Province, China
Telephone +86(898) 8868 9828
Facsimile +86(898) 8868 9686

Europe
Mandarin Oriental Hotel du Rhône, Geneva
Quai Turrettini 1, 1201 Geneva, Switzerland
Telephone +41(22) 909 0000
Facsimile +41(22) 909 0010
Email: mogva-reservations@mohg.com
Mandarin Oriental Hyde Park, London
66 Knightsbridge
London, SW1X 7LA, United Kingdom
Telephone +44(0) 20 7235 2000
Facsimile +44(0) 20 7235 2001
Email: molon-reservations@mohg.com
Mandarin Oriental, Munich
Neuturmstrasse 1, 80331 Munich, Germany
Telephone +49(89) 290 980
Facsimile +49(89) 222 539
Email: momuc-reservations@mohg.com
Mandarin Oriental, Prague
Nebovidska 459/1, 11800 Prague 1
Czech Republic
Telephone +420 233 088 888
Facsimile +420 233 088 668
Email: moprg-reservations@mohg.com
The Americas
Elbow Beach, Bermuda
60 South Shore Road, Paget Parish
Bermuda PG 04
Telephone +1(441) 236 3535
Facsimile +1(441) 236 8043
Email: ebbda-reservations@mohg.com
Mandarin Oriental, Miami
500 Brickell Key Drive, Miami
Florida 33131, USA
Telephone +1(305) 913 8288
Facsimile +1(305) 913 8300
Email: momia-reservations@mohg.com
Mandarin Oriental, New York
80 Columbus Circle at 60th Street
New York, New York 10023, USA
Telephone +1(212) 805 8800
Facsimile +1(212) 805 8888
Email: monyc-reservations@mohg.com
Mandarin Oriental Riviera Maya, Mexico
Km. 298.8 Carretera #307, Playa del Carmen
Quintana Roo, Mexico 77710
Telephone +152(984) 877 3880
Facsimile +152 (984) 877 3288
Email: mocun-reservations@mohg.com
Mandarin Oriental, San Francisco
222 Sansome Street, San Francisco
California 94104-2792, USA
Telephone +1(415) 276 9888
Facsimile +1(415) 433 0289
Email: mosfo-reservations@mohg.com
Mandarin Oriental, Washington D.C.
1330 Maryland Avenue, SW
Washington D.C. 20024, USA
Telephone +1(202) 554 8588
Facsimile +1(202) 554 8999
Email: mowas-reservations@mohg.com
Mandarin Oriental, Boston (2008)
776 Boylston Street, Boston
Massachusetts 02116, USA
Telephone +1(617) 531 0888
Facsimile +1(617) 531 0889
Email: mobos-sales@mohg.com
Annual Report 2007 85

Sales and Reservations Offices
Mandarin Oriental Hotel Group
Sales Offices
Asia-Pacific
5/F, 281 Gloucester Road, Causeway Bay, Hong Kong
Telephone +852 2895 9278
Facsimile +852 2837 3518
China
Room 529, China World Trade Centre, Tower 1
No. 1 Jian Guo Men Wai Avenue
Beijing 100004, China
Telephone +86(10) 6505 2806
Facsimile +86(10) 6505 5205
c/o Jardine Matheson (China) Ltd
Room 2406, Block B, Centre Plaza
161 Lin He Xi Road, Tian He District
Guangzhou 510620, China
Telephone +86(20) 3831 0798
Facsimile +86(20) 3831 0789
Room 1109B, Bund Center, 222 Yan An Road East
Huang Pu District, Shanghai 200002, China
Telephone +86(21) 6335 1800
Facsimile +86(21) 6335 2567
Japan
8F, Sengoku Building 2-4-15
Nihonbashi Muromachi
Chuo-ku, Tokyo 103-0022 Japan
Telephone +81(3) 3231 2920
Facsimile +81(3) 3231 2925
Singapore
5 Raffles Avenue
Marina Square, Singapore 039797
Telephone +65 6339 8811
Facsimile +65 6339 0597
86 Mandarin Oriental International Limited
Germany
Dreieichstrasse 59
D-60594 Frankfurt am Main, Germany
Telephone +49(69) 610 631
Facsimile +49(69) 610 635
United Kingdom / Southern Europe
Buchanan House, 3, St. James’s Square
London SW1Y 4JU, UK
Telephone +44(0) 20 7766 3680
Facsimile +44(0) 20 7766 3688
United States
3016 NE 49th Street
Fort Lauderdale, FL 33308, USA
Telephone +1(954) 489 9250
Facsimile +1(954) 489 9256
31510 Red Mill Drive
Lewes, DE 19958, USA
Telephone +1(703) 671 0660
Facsimile +1(703) 997 0655
9841 Airport Boulevard, Suite 822
Los Angeles, CA 90045, USA
Telephone +1(310) 670 6422
Facsimile +1(310) 670 6648
509 Madison Avenue, Suite 1800
New York, NY 10022, USA
Telephone +1(212) 207 8880
Facsimile +1(212) 207 8886
345 California Street
San Francisco, CA 94104, USA
Telephone +1(415) 772 8831
Facsimile +1(415) 782 3378

Mandarin Oriental
Hotel Group
Reservations Offices
www.mandarinoriental.com
Asia-Pacific
Australia
Tollfree 1 800 123 693
China
Tollfree 10 800 852 0241
Facsimile free 10 800 852 0242
Dubai
Tollfree 800 065 0539
Hong Kong
Telephone +852 2881 1288
Facsimile +852 2577 7543
Indonesia
Tollfree 001 803 65 6520
Facsimile free 001 803 65 6521
Japan
Tollfree 0120 663 230
Malaysia
Tollfree 00 800 2828 3838
Facsimile free 00 800 2828 6868
New Zealand
Tollfree 00 800 2828 3838
Singapore
Telephone +65 6222 4722
Facsimile +65 6227 1087
Taiwan
Tollfree 00 800 2828 3838
Facsimile free 00 800 2828 6868
Thailand
Facsimile free 001 800 2828 6868
Europe
Austria
Tollfree 00 800 2828 3838
Belgium
Tollfree 00 800 2828 3838
France
Tollfree 00 800 2828 3838
Germany
Tollfree 00 800 2828 3838
Italy
Tollfree 00 800 2828 3838
Netherlands
Tollfree 00 800 2828 3838
Spain
Tollfree 00 800 2828 3838
Switzerland
Tollfree 00 800 2828 3838
United Kingdom
Tollfree 00 800 2828 3838
For other European countries
Telephone +49(69) 6641 9614
United States, Canada
& Central America
Mexico
Tollfree 001 (800) 526 6566
USA / Canada
Tollfree 1 800 526 6567
South America
Argentina (North)
Tollfree 0 800 555 4288
then dial 877 714 0587
Argentina (South)
Tollfree 0 800 222 1288
then dial 877 714 0587
Brazil
Tollfree 0800 891 3578
Annual Report 2007 87

Designed by Sedgwick Richardson